Variable marginal propensities to pirate and the diffusion of computer software
In this paper, we empirically investigate the dynamics of the marginal propensity to pirate for computer software. We introduce a state space formulation that allows us to estimate error structures and parameter significance, in contrast to previous work. For data from 1987-92, we find a rising propensity to pirate as the number of existing pirate copies increases, and higher late piracy incidence than implied by static models. We strengthen prior results on the impact of piracy in the spreadsheet market, finding it to be the only significant internal influence on diffusion. However, when we allow for negative error correlation between legal and pirate acquisitions, we contradict earlier work by finding that, in the word processor market, piracy did not contribute to diffusion and only eroded legal sales.
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| Date of creation: | 10 Apr 2013 |
| Handle: | RePEc:pra:mprapa:46036 |
| Contact details of provider: | Postal: Ludwigstraße 33, D-80539 Munich, Germany Phone: +49-(0)89-2180-2459 Fax: +49-(0)89-2180-992459 Web page: https://mpra.ub.uni-muenchen.de More information through EDIRC
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- Jain, Dipak C & Rao, Ram C, 1990. "Effect of Price on the Demand for Durables: Modeling, Estimation, and Findings," Journal of Business & Economic Statistics, American Statistical Association, vol. 8(2), pages 163-170, April.
- van den Bulte, C. & Stremersch, S., 2003. "Contagion and heterogeneity in new product diffusion: An emperical test," ERIM Report Series Research in Management ERS-2003-077-MKT, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam. Full references (including those not matched with items on IDEAS)
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