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Piracy and box office movie revenues: Evidence from Megaupload


Peukert, Christian; Claussen, Jörg; Kretschmer, Tobias (2017). Piracy and box office movie revenues: Evidence from Megaupload. International Journal of Industrial Organization, 52:188-215.

Abstract

In this paper we evaluate the heterogeneous effects of online copyright enforcement. We ask whether the unexpected shutdown of the popular file hosting platform Megaupload had a differential effect on box office revenues of wide-release vs. niche movies. Identification comes from a comparison of movies that were available on Megaupload to those that were not. We show that only movies that premiere in a relatively large number of theaters benefitted from the shutdown of Megaupload. The average effect, however, is negative. We provide suggestive evidence that this result is driven by information externalities. The idea is that online piracy acts as a mechanism to spread information about product characteristics across consumers with different valuations for the product. Our results question the effectiveness of blanket public anti-piracy policy, not only from a consumer perspective, but also from a producer perspective.

Abstract

In this paper we evaluate the heterogeneous effects of online copyright enforcement. We ask whether the unexpected shutdown of the popular file hosting platform Megaupload had a differential effect on box office revenues of wide-release vs. niche movies. Identification comes from a comparison of movies that were available on Megaupload to those that were not. We show that only movies that premiere in a relatively large number of theaters benefitted from the shutdown of Megaupload. The average effect, however, is negative. We provide suggestive evidence that this result is driven by information externalities. The idea is that online piracy acts as a mechanism to spread information about product characteristics across consumers with different valuations for the product. Our results question the effectiveness of blanket public anti-piracy policy, not only from a consumer perspective, but also from a producer perspective.

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Additional indexing

Item Type:Journal Article, refereed, original work
Communities & Collections:03 Faculty of Economics > Department of Business Administration
Dewey Decimal Classification:330 Economics
Language:English
Date:2017
Deposited On:22 Aug 2019 14:54
Last Modified:13 Oct 2019 05:57
Publisher:Elsevier
ISSN:0167-7187
OA Status:Green
Free access at:Publisher DOI. An embargo period may apply.
Publisher DOI:https://doi.org/10.1016/j.ijindorg.2016.12.006
Other Identification Number:merlin-id:14319

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