Posner's argument basically falls apart here:

"...once copies are available to others, it is often inexpensive for these users to make additional copies. If the copies made by the creator of the work are priced at or close to marginal cost, others may be discouraged from making copies..."

On the one hand, he is saying that once people get copies, they are inclined to make more copies. On the other, he says that the price charged by the author will somehow influence whether or not people make copies. That second statement basically ignores the reality of both modern life, with computers and the Internet, and ancient life, where books were frequently copied regardless of what the author of the book wanted to be paid. People receive files at exactly the marginal cost of copying this files all the time, but that in no way discourages them from making more copies; people routinely make copies of creative works that are freely distributed by their authors.

In reality, copyright has only ever been about authors at a superficial level. The first copyright law, the Licensing of the Press Act, was passed for the purpose of censoring authors by giving a specific guild a legal monopoly on printing, allowing the government to control the legal distribution channels of written work. When that law expired, the printers whose income was inflated by it began a lobbying campaign to restore their monopoly position, which was helped by a few authors; this led to the first modern copyright law, which served as the model for US copyright law (ironically copied from the English law). For all the claims about copyright paying the creators of copyrighted works, the biggest financial beneficiaries of US copyrights have been the businesses that sell copies of those works; that is as true today as it was 200 years ago. It was only recently that authors and musicians even gained the ability to distribute copies of their works without those industries.

The public good served by copyright is not the entertainment or research works being created, but the distribution of those works. The point is not to pay authors, it is to ensure that printing remains a profitable business. The most extreme example of this is academic publishing, where not only are authors volunteers, but so are reviewers and editors. It is overwhelmingly common for authors, musicians, and actors of all kinds to have "day jobs" despite the financial success of their creative work; only a handful can live on royalty payments alone. Even if the point of copyright is to reward creative work and encourage its creation, the system as it exists today is a monumental failure.

The article you link to actually combines the publishers and the authors of creative works into a single hypothetical entity:

"To simplify the analysis, we ignore any distinction between costs incurred by authors and by publishers, and therefore use the term "author" (or "creator") to mean both author and publisher."

My point here and elsewhere is this: the publishers are not needed anymore. We have much better ways to distribute creative work to the general population; we should be encouraging their use rather than trying to legislate them out of existence. Creative work is not dependent on profit (if it was, there would be almost no music in existence right now), nor is a market system strictly necessary to fund creative work (e.g. scientific research, which is funded by grants given to researchers or institutions regardless of the profitability of the work).