| By: |
Adermon, Adrian (Uppsala University);
Liang, Che-Yuan (Research Institute of Industrial Economics (IFN)) |
| Abstract: |
This paper investigates the effects of illegal file sharing (piracy) on music
and movie sales. The Swedish implementation of the European Union directive
IPRED on April 1, 2009 suddenly increased the risk of being caught and
prosecuted for file sharing. We investigate the subsequent drop in piracy as
approximated by the drop in Swedish Internet traffic and the effects on music
and movie sales in Sweden. We find that the reform decreased Internet traffic
by 18 percent during the subsequent six months. It also increased sales of
physical music by 27 percent and digital music by 48 percent. Furthermore, it
had no significant effects on the sales of theater tickets or DVD movies. The
results indicate that pirated music is a strong substitute for legal music
whereas the substitutability is less for movies. |
| Keywords: |
Copyright protection; Piracy; File sharing; Music; Movies; IPRED; Natural experiment |
| JEL: |
D12 D40 K11 K42 |
| Date: |
2010–10–28 |
| URL: |
http://d.repec.org/n?u=RePEc:hhs:iuiwop:0854&r=cul |