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Infringing Use as a Path to Legal Consumption: Evidence from a Field Experiment

Hong Luo () and Julie Mortimer ()
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Hong Luo: Harvard Business School

No 971, Boston College Working Papers in Economics from Boston College Department of Economics

Abstract: Copyright infringement may result from frictions preventing legal consumption, but may also reveal demand. Motivated by this fact, we run a field experiment in which we contact firms that are caught infringing on expensive digital images. Emails to all firms include a link to the licensing page of the infringed image; for treated firms, we add links to a significantly cheaper licensing site. Making infringers aware of the cheaper option leads to a fourteen-fold increase in the ex-post licensing rate. Two additional experimental interventions are designed to reduce search costs for (i) price and (ii) product information. Both interventions—immediate price comparison and recommendation of images similar to those infringed—have large positive effects. Our results highlight the importance of mitigating user costs in small-value transactions.

Keywords: intellectual property; digital piracy; copyright; field experiment (search for similar items in EconPapers)
JEL-codes: O3 O33 O34 C9 C93 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-exp, nep-ict and nep-ipr
Date: 2018-12-20
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