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Copyright enforcement and product quality signaling in markets for computer software

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  • Takeyama, Lisa N.

Abstract

This paper considers the impact of consumer copying of computer software when there is asymmetric information about product quality. In particular, the paper: (1) examines how the presence of copying can enhance the feasibility of production of high quality software when quality is a priori unknown to consumers and (2) explores the novel possibility that a software producer can signal product quality via its copyright enforcement decision. Under certain conditions, when there is asymmetric information about product quality, providers of high quality software can be made strictly better off with less than full copyright enforcement; in some cases, they do not produce at all in the absence of copying.

Suggested Citation

  • Takeyama, Lisa N., 2009. "Copyright enforcement and product quality signaling in markets for computer software," Information Economics and Policy, Elsevier, vol. 21(4), pages 291-296, November.
    • Handle: RePEc:eee:iepoli:v:21:y:2009:i:4:p:291-296
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    References listed on IDEAS

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    1. Takeyama, Lisa N, 1994. "The Welfare Implications of Unauthorized Reproduction of Intellectual Property in the Presence of Demand Network Externalities," Journal of Industrial Economics, Wiley Blackwell, vol. 42(2), pages 155-166, June.
    2. Kathleen Reavis Conner & Richard P. Rumelt, 1991. "Software Piracy: An Analysis of Protection Strategies," Management Science, INFORMS, vol. 37(2), pages 125-139, February.
    3. Peitz, Martin & Waelbroeck, Patrick, 2006. "Piracy of digital products: A critical review of the theoretical literature," Information Economics and Policy, Elsevier, vol. 18(4), pages 449-476, November.
    4. Wendy J. Gordon & Richard Watt (ed.), 2003. "The Economics of Copyright," Books, Edward Elgar Publishing, number 2998.
    5. Ram D. Gopal & G. Lawrence Sanders, 2006. "Do Artists Benefit from Online Music Sharing?," The Journal of Business, University of Chicago Press, vol. 79(3), pages 1503-1534, May.
    6. Peitz, Martin & Waelbroeck, Patrick, 2006. "Why the music industry may gain from free downloading -- The role of sampling," International Journal of Industrial Organization, Elsevier, vol. 24(5), pages 907-913, September.
    7. Anne Duchene & Patrick Waelbroeck, 2005. "Peer-to-peer, piracy and the copyright law: implications for consumers and artists," Chapters, in: Lisa N. Takeyama & Wendy J. Gordon & Ruth Towse (ed.), Developments in the Economics of Copyright, chapter 4, Edward Elgar Publishing.
    8. Liebowitz, S J, 1985. "Copying and Indirect Appropriability: Photocopying of Journals," Journal of Political Economy, University of Chicago Press, vol. 93(5), pages 945-957, October.
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    Cited by:

    1. Eric Darmon & Alexandra Rufini & Dominique Torre, 2014. "Publisher's Announcements and Piracy-Monitoring Devices in Software Adoption," Annals of Economics and Statistics, GENES, issue 115-116, pages 409-430.
    2. Žigić, Krešimir & Střelický, Jiří & Kúnin, Michael, 2023. "Copyright and firms’ own IPR protection in a software market: Monopoly versus duopoly," Economic Modelling, Elsevier, vol. 123(C).
    3. William M. Volckmann, 2023. "The effects of market size, wealth, and network effects on digital piracy and profit," European Journal of Law and Economics, Springer, vol. 55(1), pages 61-85, February.
    4. Kresimir Zigic & Jiri Strelicky & Michael Kunin, 2014. "How Does Public IPR Protection Affect its Private Counterpart? Copyright and the Firms' Own IPR Protection in a Software Duopoly," CERGE-EI Working Papers wp518, The Center for Economic Research and Graduate Education - Economics Institute, Prague.
    5. Kresimir Zigic & Jiri Strelicky & Michal Kunin, 2020. "Private and Public IPR Protection in a Vertically Differentiated Software Duopoly," CERGE-EI Working Papers wp671, The Center for Economic Research and Graduate Education - Economics Institute, Prague.
    6. repec:hal:wpaper:halshs-00929792 is not listed on IDEAS
    7. Kresimir Zigic & Jiri Strelicky & Michael Kunin, 2013. "The Interaction between Private and Public IPR Protection in a Software Market: A Positive and Normative Analysis," CERGE-EI Working Papers wp490, The Center for Economic Research and Graduate Education - Economics Institute, Prague.
    8. Jiri Strelicky & Kresimir Zigic, 2011. "Intellectual Property Rights Protection and Enforcement in a Software Duopoly," CERGE-EI Working Papers wp435, The Center for Economic Research and Graduate Education - Economics Institute, Prague.
    9. Kresimir Zigic & Jiri Strelicky & Michael Kunin, 2015. "Modeling Software Piracy Protection: Monopoly versus Duopoly," CERGE-EI Working Papers wp551, The Center for Economic Research and Graduate Education - Economics Institute, Prague.

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