Discussion Paper

No. 2018-4 | January 11, 2018
Technological development and software piracy

Abstract

In this paper, the authors analyze the differences in piracy rates from one country to another. Like previous papers on the topic, they find that more developed countries have lower incentives for pirating. Unlike previous papers, they find that the piracy rate is positively correlated with the tax burden rate but negatively correlated with the domestic market size and exports over GDP. The authors also separate the impacts of education and R&D on piracy, and find two effects with opposite signs. Moreover, they find that those countries with smaller, more efficient bureaucracies are likely to protect intellectual property more effectively. Finally, they show that the spread of access to the Internet is negatively correlated with the software piracy rate.

Data Set

  • DataBank.ods
    [application/vnd.oasis.opendocument.spreadsheet, 447K]

JEL Classification:

K42, L86, O3, O57

Assessment

  • Downloads: 335

Links

Cite As

Francisco Martínez-Sánchez and Andrés Romeu (2018). Technological development and software piracy. Economics Discussion Papers, No 2018-4, Kiel Institute for the World Economy. http://www.economics-ejournal.org/economics/discussionpapers/2018-4


Comments and Questions


Anonymous - Referee report 1
January 11, 2018 - 11:07

This paper uses panel data to study the differences in piracy rates across countries. The authors find that more developed countries have lower incentives for pirating. Unlike previous papers, piracy rate is positively correlated with the tax burden rate but negatively correlated with the domestic market size and exports over ...[more]

... GDP. The authors separate the impacts of education and R&D on piracy, and find two effects with opposite signs. Results show that the spread of access to the Internet is negatively correlated with the software piracy rate.

I think that the topic of the paper is interesting and worthwhile. However, the authors need to do a good round of revisions.

The main issue with the paper is the lack of empirical robustness checks with alternate data/estimation. For instance, “hard” R&D data, albeit at a macro level is available from the World Bank and that should be used alternately to check the robustness. I would also try other macro variables.

Further, usually education and R&D are not used together as explanatory variables, given the high overlap between the two. So the authors need to do alternate specifications.

Regarding estimation, I would also suggest that the authors use perhaps GMM type estimation to check for robustness.

Finally, the abstract needs to be made more pointed.

“Corruption and Software Piracy: A Comparative Perspective”, Policy & Internet, 2011.


Francisco Martínez-Sánchez and Andrés Romeu - Reply to referee report 1
January 17, 2018 - 16:45

see attached file


Anonymous - Referee report 2
January 16, 2018 - 19:42

see attached file


Francisco Martínez-Sánchez and Andrés Romeu - Reply to referee report 2
January 29, 2018 - 08:41

see attached file