Bai and Waldfogel (2012)

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1. Relationship between protection (subject matter/term/scope) and supply/economic development/growth/welfare 2. Relationship between creative process and protection - what motivates creators (e.g. attribution; control; remuneration; time allocation)? 3. Harmony of interest assumption between authors and publishers (creators and producers/investors) 4. Effects of protection on industry structure (e.g. oligopolies; competition; economics of superstars; business models; technology adoption) 5. Understanding consumption/use (e.g. determinants of unlawful behaviour; user-generated content; social media)

A. Nature and Scope of exclusive rights (hyperlinking/browsing; reproduction right) B. Exceptions (distinguish innovation and public policy purposes; open-ended/closed list; commercial/non-commercial distinction) C. Mass digitisation/orphan works (non-use; extended collective licensing) D. Licensing and Business models (collecting societies; meta data; exchanges/hubs; windowing; crossborder availability) E. Fair remuneration (levies; copyright contracts) F. Enforcement (quantifying infringement; criminal sanctions; intermediary liability; graduated response; litigation and court data; commercial/non-commercial distinction; education and awareness)

Source Details

Bai and Waldfogel (2012)
Title: Movie piracy and sales displacement in two samples of chinese consumers
Author(s): Bai, J., Waldfogel, J.
Year: 2012
Citation: Bai, J., & Waldfogel, J. (2012). Movie piracy and sales displacement in two samples of Chinese consumers. Information Economics and Policy, 24(3), 187-196.
Link(s): Definitive , Open Access
Key Related Studies:
Discipline:
Linked by:
About the Data
Data Description: The data for this study comes from two surveys administered in China. The first survey was administered to students at a Chinese University in late 2008. The second survey was administered to a sample of Chinese Internet Users in July 2009.
Data Type: Primary data
Secondary Data Sources:
Data Collection Methods:
Data Analysis Methods:
Industry(ies):
Country(ies):
Cross Country Study?: No
Comparative Study?: No
Literature review?:
Government or policy study?:
Time Period(s) of Collection:
  • 2008,2009
Funder(s):
  • None stated

Abstract

Intellectual property piracy is widely believed, by authorities in both US industry and government, to be rampant in China. Because we lack evidence on the rate at which unpaid consumption displaces paid consumption, we know little about the size of the effect of pirate consumption on the volume of paid consumption. We provide direct evidence on both the volume of unpaid consumption and the rate of sales displacement for movies in China using two surveys administered in late 2008 and mid-2009. First, using a survey of Chinese college students’ movie consumption and an empirical approach parallel to a similar recent study of US college students, we find that three quarters of movie consumption is unpaid and that each instance of unpaid consumption displaces 0.14 paid consumption instances. Second, a survey of online Chinese consumers reveals similar patterns of paid and unpaid movie consumption but a displacement rate of roughly zero. We speculate on the small displacement rate finding relative to most of the piracy literature.

Main Results of the Study

  • Both paid and unpaid consumption of movies rise sharply in self-reported interest in movies
  • Paid consumption rises with family income and unpaid consumption falls, though not statistically significant
  • Chinese consumers view lesser movies compared to US (30 vs. 50)
  • Unpaid consumption makes up far larger share of consumption for the chinese respondents (roughly three quarters) compared to 5% in US.
  • Sales displacement is smaller in case of China compared to US. Hence there is small damage from movie piracy in China despite large volumes of unpaid consumption. One explanation for this could be lower overall movie consumption in China.

Policy Implications as Stated By Author

It is widely believed that intellectual property piracy is widespread in China and elsewhere in Asia. Especially as China grows wealthy, China could become an important export market for intellectual property. US film studios are in particular are concerned about piracy.


Coverage of Study

Coverage of Fundamental Issues
Issue Included within Study
Relationship between protection (subject matter/term/scope) and supply/economic development/growth/welfare
Green-tick.png
Relationship between creative process and protection - what motivates creators (e.g. attribution; control; remuneration; time allocation)?
Harmony of interest assumption between authors and publishers (creators and producers/investors)
Effects of protection on industry structure (e.g. oligopolies; competition; economics of superstars; business models; technology adoption)
Green-tick.png
Understanding consumption/use (e.g. determinants of unlawful behaviour; user-generated content; social media)
Coverage of Evidence Based Policies
Issue Included within Study
Nature and Scope of exclusive rights (hyperlinking/browsing; reproduction right)
Green-tick.png
Exceptions (distinguish innovation and public policy purposes; open-ended/closed list; commercial/non-commercial distinction)
Mass digitisation/orphan works (non-use; extended collective licensing)
Licensing and Business models (collecting societies; meta data; exchanges/hubs; windowing; crossborder availability)
Fair remuneration (levies; copyright contracts)
Enforcement (quantifying infringement; criminal sanctions; intermediary liability; graduated response; litigation and court data; commercial/non-commercial distinction; education and awareness)

Datasets

Sample size: 372
Level of aggregation: University students
Period of material under study: 2008


Sample size: 3852
Level of aggregation: University students
Period of material under study: 2009