Which countries protect intellectual property? The case of software piracy

Abstract

Using data on software piracy, we examine how protection of intellectual propertÿ aries across countries. Consistent with other studies, we find that intellectual property recei¨es greater protection in de¨eloped economies; high-income countries ha¨e lower piracy rates. We also find that protection depends on cultural factors. Countries with an indi¨idualist culture ha¨e lower piracy rates than do countries with a collecti¨ist culture. Piracy rates are also lower in countries that ha¨e strong institutions that enforce contracts and protect property from expropriation. These results suggest that national policies toward intellectual property reflect not only Ž . economic concerns but also national culture and institutions. JEL 034, L86

Determinants of worldwide software piracy losses

“…Some of the studies that use cross sectional data are Marron and Steel (2000), van Kranenburg and Hogenbirk (2005), Banerjee et al (2005), Andrés (2006b), Goel and Nelson (2009), Andrés and Goel (2011) and Goel and Nelson (2012). Examples of studies that used panel data are: Andrés (2006a), Andrés and Asongu (2013), Asongu (2012), Boyce (2011) and Chen et al (2010).…”

“…Technological development can affect the access to software, but can also means more protection in the form of R&D. Marron and Steel (2000) and Andrés (2006b) found that, more protection decreases software piracy. Nevertheless access to technology diffusion of Internet, computer based technologies and accessibility to information networks in a country enables both potential pirates and protectors of intellectual properties to do their jobs more effectively (Goel, Nelson 2009).…”

“…The majority of studies find that income, namely Gross Domestic Product (GDP) is negatively related with software piracy (see for instance Marron and Steel (2000) and Andrés (2006a)), which indicates that more income can be devoted to digital content such as software. Also within a country, inequality plays an important role as Andrés (2006b) find that more equal societies are associated with lower software piracy.…”

“…One of them was the average years of schooling in population with age over 25 years (see Barro and Lee 2013), which was used by Marron and Steel (2000) and Andrés (2006b). They find that an increase on educational levels decreases software piracy.…”

“…It has been found to affect negatively software piracy (Marron, Steel 2000). As with Marron and Steel (2000) we introduce this variable that may also affect piracy losses. In our case this variable indicates investment that is made on software protection, namely software code.…”