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Piracy as Strategy? A Reexamination of Product Piracy

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  • JULIO ORLANDO DE CASTRO

    ()
    (Instituto de Empresa)

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    Abstract

    (WP 08/04 Clave pdf) To explore the impact that piracy has on demand for legal versions of a product and firm performance, we use the literatures of information economics and strategic management to expand the analysis of piracy to markets other than software. Our paper helps clarify the nature of customer demand for legal versions of products, and gain a deeper understanding of the way that piracy can enhance the performance of those firms that own the intellectual property. We contend that although piracy represents unauthorized imitation of a firm’s intellectual property, there are some circumstances when piracy can improve the value of the intellectual property.

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    File URL: http://latienda.ie.edu/working_papers_economia/WP04-08.pdf
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    Bibliographic Info

    Paper provided by Instituto de Empresa, Area of Economic Environment in its series Working Papers Economia with number wp04-08.

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    Length: 24 pages
    Date of creation: Mar 2004
    Date of revision:
    Handle: RePEc:emp:wpaper:wp04-08

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    1. Kathleen Reavis Conner & Richard P. Rumelt, 1991. "Software Piracy: An Analysis of Protection Strategies," Management Science, INFORMS, vol. 37(2), pages 125-139, February.
    2. Katz, Michael L & Shapiro, Carl, 1985. "Network Externalities, Competition, and Compatibility," American Economic Review, American Economic Association, vol. 75(3), pages 424-40, June.
    3. Bhagwati, Jagdish N & Hansen, Bent, 1973. "A Theoretical Analysis of Smuggling," The Quarterly Journal of Economics, MIT Press, vol. 87(2), pages 172-87, May.
    4. Gandal, Neil & Greenstein, Shane & Salant, David, 1999. "Adoptions and Orphans in the Early Microcomputer Market," Journal of Industrial Economics, Wiley Blackwell, vol. 47(1), pages 87-105, March.
    5. Michael L. Katz & Carl Shapiro, 1994. "Systems Competition and Network Effects," Journal of Economic Perspectives, American Economic Association, vol. 8(2), pages 93-115, Spring.
    6. Park, C Whan & Milberg, Sandra & Lawson, Robert, 1991. " Evaluation of Brand Extensions: The Role of Product Feature Similarity and Brand Concept Consistency," Journal of Consumer Research, University of Chicago Press, vol. 18(2), pages 185-93, September.
    7. Johnson, William R, 1985. "The Economics of Copying," Journal of Political Economy, University of Chicago Press, vol. 93(1), pages 158-74, February.
    8. Banerjee, Abhijit V, 1992. "A Simple Model of Herd Behavior," The Quarterly Journal of Economics, MIT Press, vol. 107(3), pages 797-817, August.
    9. Vijay Mahajan & Eitan Muller & Frank M. Bass, 1995. "Diffusion of New Products: Empirical Generalizations and Managerial Uses," Marketing Science, INFORMS, vol. 14(3_supplem), pages G79-G88.
    10. Peter Diamond, 1985. "Search Theory," Working papers 389, Massachusetts Institute of Technology (MIT), Department of Economics.
    11. Church, Jeffrey & Gandal, Neil, 1992. "Network Effects, Software Provision, and Standardization," Journal of Industrial Economics, Wiley Blackwell, vol. 40(1), pages 85-103, March.
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