Piracy and competition

Arbeitspapier

The effects of (private, small-scale) piracy on the pricing behavior of producers of information goods are studied within a unified model of vertical differentiation. Although information goods are assumed to be perfectly horizontally differentiated, demands are interdependent because the copying technology exhibits increasing returns to scale. We characterize the Bertrand-Nash equilibria in a duopoly. Comparing equilibrium prices to the prices set by a multiproduct monopolist, we show that competition drives prices up and reduces total surplus.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: CESifo Working Paper ; No. 1350

Classification and Topics

• Classification: Wirtschaft ; Oligopoly and Other Imperfect Markets ; Information and Internet Services; Computer Software ; Entertainment; Media ; Property Law ; Intellectual Property and Intellectual Capital
• Subject: information goods ; piracy ; copyright ; pricing ; Digitale Güter ; Produktpiraterie ; Computerkriminalität ; Betriebliche Preispolitik ; Produktdifferenzierung ; Duopol ; Wettbewerb ; Theorie

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Belleflamme, Paul ; Picard, Pierre M.
• Event: Veröffentlichung
• (who): Center for Economic Studies and ifo Institute (CESifo)
• (where): Munich
• (when): 2004

Further information

• Handle: http://hdl.handle.net/10419/18713
• Last update: 10.03.2025, 11:43 AM CET