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DOES COPYRIGHT ENFORCEMENT ENCOURAGE PIRACY? -super-

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  • RICK HARBAUGH
  • RAHUL KHEMKA

Abstract

When copyright enforcement is targeted at high-value buyers such as corporate and government users, the copyright holder charges super-monopoly prices, thereby encouraging low-value buyers to switch to inferior pirated copies. We show that enlarging the copyright holder's captive market through more extensive copyright enforcement reduces prices toward the monopoly level, increases sales of legitimate copies and can increase consumer surplus. Therefore, in contrast with the case of more intensive copyright enforcement, more extensive copyright enforcement over some range can increase the incentive to generate intellectual property while also reducing the loss to consumers from monopoly power. Copyright 2010 The Authors. Journal compilation 2010 Blackwell Publishing Ltd. and the Editorial Board of The Journal of Industrial Economics.

Suggested Citation

  • Rick Harbaugh & Rahul Khemka, 2010. "DOES COPYRIGHT ENFORCEMENT ENCOURAGE PIRACY? -super-," Journal of Industrial Economics, Wiley Blackwell, vol. 58(2), pages 306-323, June.
  • Handle: RePEc:bla:jindec:v:58:y:2010:i:2:p:306-323
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    References listed on IDEAS

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    Cited by:

    1. Dyuti S. Banerjee, 2014. "Effectiveness of government anti-piracy enforcement policy: commitment versus non-commitment," Chapters,in: Handbook on the Economics of Copyright, chapter 15, pages 264-284 Edward Elgar Publishing.
    2. C. Bellégo & R. De Nijs, 2015. "The redistributive effect of online piracy on the box office performance of American movies in foreign markets," Documents de Travail de l'Insee - INSEE Working Papers g2015-17, Institut National de la Statistique et des Etudes Economiques.
    3. Tunay I. Tunca & Qiong Wu, 2013. "Fighting Fire with Fire: Commercial Piracy and the Role of File Sharing on Copyright Protection Policy for Digital Goods," Information Systems Research, INFORMS, vol. 24(2), pages 436-453, June.

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