Difference between revisions of "Maffioletti and Ramello (2004)"

From Copyright EVIDENCE
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|FundamentalIssue=5. Understanding consumption/use (e.g. determinants of unlawful behaviour; user-generated content; social media), 1. Relationship between protection (subject matter/term/scope) and supply/economic development/growth/welfare,
 
|FundamentalIssue=5. Understanding consumption/use (e.g. determinants of unlawful behaviour; user-generated content; social media), 1. Relationship between protection (subject matter/term/scope) and supply/economic development/growth/welfare,
 
|EvidenceBasedPolicy=F. Enforcement (quantifying infringement; criminal sanctions; intermediary liability; graduated response; litigation and court data; commercial/non-commercial distinction; education and awareness),
 
|EvidenceBasedPolicy=F. Enforcement (quantifying infringement; criminal sanctions; intermediary liability; graduated response; litigation and court data; commercial/non-commercial distinction; education and awareness),
|Discipline=A1: General Economics, C0: General, C00: General, C1: Econometric and Statistical Methods and Methodology: General, C10: General, H1: Structure and Scope of Government, H10: General, K: Law and Economics, K00: General, K42: Illegal Behavior and the Enforcement of Law, O3: Technological Change • Research and Development • Intellectual Property Rights, O34: Intellectual Property and Intellectual Capital
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|Discipline=K42: Illegal Behavior and the Enforcement of Law, O3: Technological Change • Research and Development • Intellectual Property Rights, O34: Intellectual Property and Intellectual Capital
 
|Intervention-Response=* Experimental findings seem to recommend that firms adopt a different and more affordable pricing strategy that could have two effects; allowing positive profits, and crowding-out a part of illegal consumption  
 
|Intervention-Response=* Experimental findings seem to recommend that firms adopt a different and more affordable pricing strategy that could have two effects; allowing positive profits, and crowding-out a part of illegal consumption  
  

Revision as of 13:48, 22 August 2015

Advertising Architectural Publishing of books, periodicals and other publishing Programming and broadcasting Computer programming Computer consultancy Creative, arts and entertainment Cultural education

Film and motion pictures Sound recording and music publishing Photographic activities PR and communication Software publishing (including video games) Specialised design Television programmes Translation and interpretation

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

Maffioletti and Ramello (2004)
Title: Should We Put Them in Jail? Copyright Infringement, Penalties and Consumer Behaviour: Insights from Experimental Data
Author(s): Maffioletti, A., Ramello, G. B.
Year: 2004
Citation: Maffioletti, A. Ramello, G. B. 2004. Should We Put Them in Jail? Copyright Infringement, Penalties and Consumer Behaviour: Insights from Experimental Data. Review of Economic Research on Copyright Issues, 1, 81-95.
Link(s): Open Access
Key Related Studies:
Discipline:
Linked by: Liebowitz and Watt (2006)
About the Data
Data Description: In total, 74 students participated to the first experiment, and 54 in the second experiment. In the Third experiment where the real willingness to pay was assessed the authors ran 4 auctions with 15 participants each. 188 observations in total and They were all students from a northern Italian university with similar background.
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?: No
Government or policy study?: No
Time Period(s) of Collection:
  • 2004
Funder(s):
  • Not stated

Abstract

The purpose of this paper is to deepen the knowledge of consumer behaviour in information goods markets, taking as a reference the sound recording market. In particular, its aim is twofold: on the one hand it attempts to get new insights on consumers paying special attention to their willingness to pay and to purchasing behaviour; on the other hand it wants to find out whether the recently adopted increase in legal measures against consumers by industries can have positive effects on lowering copyright infringement and raising legal demand. Using experimental methods, we elicited individual preferences in legal and burned CDs. We used hypothetical as well as real choices. Our experimental results suggest that lawsuits can effectively lower the rate of copying because they raise the probability of being caught by consumers and thus punished. However, they do not necessarily raise legal sales since the measured consumer willingness to pay is generally lower than the market price for legal products. Consequently, increased copyright enforcement may only lead to demand withholding.

Main Results of the Study

The aim of the Experiments was to answer the 3 questions below:

  1. Whether a potential demand for legal CDs exists which could be satisfied at the current market price or at a lower price than the actual market price.
  2. Whether a positive price exists that is significantly different from zero for burned CDs.
  3. Whether the judicial strategy of suing consumers can have positive effects on lowering copyright infringement and/or on raising the demand for legal products.

To answer these questions the authors ran three experiments, two measuring the hypothetical willingness to pay and one measuring the real willingness to pay through an auction market.

Experimental data suggests that lawsuits can effectively lower the rate of copying because they raise the probability percieved by consumers of being caught and thus of being punished. However they donot necessarily raise legal sales since the measured consumer willingness to pay is generally lower than the market price for legal products. Consequently, increased copyright enforcement may only lead to demand withholding.

Policy Implications as Stated By Author

  • Experimental findings seem to recommend that firms adopt a different and more affordable pricing strategy that could have two effects; allowing positive profits, and crowding-out a part of illegal consumption
  • these outcomes, together with the existing economic literature, advocate a more cautious treatment of copyright infringement in the name of social welfare, as given a specific legal demand, infringing activities serve to increase consumer surplus in the static framework and can, under certain conditions, increase the legal demand from a dynamic perspective



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)
Understanding consumption/use (e.g. determinants of unlawful behaviour; user-generated content; social media)
Green-tick.png
Coverage of Evidence Based Policies
Issue Included within Study
Nature and Scope of exclusive rights (hyperlinking/browsing; reproduction right)
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)
Green-tick.png

Datasets

Sample size: 188
Level of aggregation: University students
Period of material under study: 2004