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Copyright Enforcement: Evidence from Two Field Experiments

Hong Luo and Julie Mortimer

No 22082, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Effective dispute resolution is important for reducing private and social costs. We study how resolution responds to changes in price and communication using a new, extensive dataset of copyright infringement incidences by firms. The data cover two field experiments run by a large stock-photography agency. We find that substantially reducing the requested amount generates a small increase in the settlement rate. However, for the same reduced request, a message informing infringers of the price reduction and acknowledging the possible unintentionality generates a large increase in the settlement rate; including a deadline further increases the response. The small price effect, compared to the large message effect, can be explained by two countervailing effects of a lower price: an inducement to settle early, but a lower threat of escalation. Furthermore, acknowledging possible unintentionality may encourage settlement due to the typically inadvertent nature of these incidences. The resulting higher settlement rate prevents additional legal action and significantly reduces social costs.

JEL-codes: L0 M2 O30 O34 (search for similar items in EconPapers)
Date: 2016-03
New Economics Papers: this item is included in nep-exp, nep-ipr, nep-pr~ and nep-law
Note: IO PR
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Published as Hong Luo & Julie Holland Mortimer, 2017. "Copyright Enforcement: Evidence from Two Field Experiments," Journal of Economics & Management Strategy, vol 26(2), pages 499-528.

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Journal Article: Copyright Enforcement: Evidence from Two Field Experiments (2017) Downloads
Working Paper: Copyright Enforcement: Evidence from Two Field Experiments (2016) Downloads
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