A Note on Jain´s Digital Piracy Model: Horizontal vs Vertical Product Differentiation

Michael Kunin and Kresimir Zigic ()

CERGE-EI Working Papers from The Center for Economic Research and Graduate Education - Economics Institute, Prague

Abstract: We study how private intellectual property rights protection affects equilibrium prices and profits in a duopoly competition between firms that offer a product variety of distinct qualities (vertical product differentiation) in a setup that is closely related to that put forward by Jain (2008), where firms offer the same qualities in equilibrium (horizontal product differentiation). Consumers may make a choice to buy a legal version, use an illegal copy (if they want to and can), or not use a product at all. Using an illegal version violates intellectual property rights protection and is thus punishable when disclosed. Thus, both private and public (copyright) intellectual property rights protection are available on scene.

Keywords: vertical and horizontal product differentiation; software piracy; Bertrand competition; private and public intellectual property rights protection (search for similar items in EconPapers)
JEL-codes: D43 L11 L21 O25 O34 (search for similar items in EconPapers)
Date: 2021-08
New Economics Papers: this item is included in nep-com, nep-ipr, nep-pay and nep-reg
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.cerge-ei.cz/pdf/wp/Wp701.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:cer:papers:wp701

Access Statistics for this paper

More papers in CERGE-EI Working Papers from The Center for Economic Research and Graduate Education - Economics Institute, Prague Contact information at EDIRC.
Bibliographic data for series maintained by Lucie Vasiljevova ().