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The Computer Generation's Willingness to Pay for Originals when Pirates are Present – A CV study

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  • Holm, Håkan

    (Department of Economics, Lund University)

Abstract

A contingent valuation method is applied to study subjects' willingness to pay for originals when illegal copies are freely available. The subjects consisted of 234 Swedish undergraduate students from the "computer generation". Only 2% of the "normal" (and 0% of the "elite") students were willing to pay the retail price for the original. However, the majority was prepared to pay a non-negligible amount for the original. Demand curves and profit maximizing behaviors are analyzed. The price elasticity of piracy indicates that piracy is insensitive to price cuts. The results have implications for the calculation of damages of piracy.

Suggested Citation

  • Holm, Håkan, 2000. "The Computer Generation's Willingness to Pay for Originals when Pirates are Present – A CV study," Working Papers 2000:9, Lund University, Department of Economics, revised 16 Mar 2001.
    • Handle: RePEc:hhs:lunewp:2000_009
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    References listed on IDEAS

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    Cited by:

    1. Ünlü, Vural & Hess, Thomas, 2003. "The optimal level of technical copyright protection: A game-theoretic approach," Working Papers 9/2003, University of Munich, Munich School of Management, Institute for Information Systems and New Media.

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    More about this item

    Keywords

    Piracy; Contingent Valuation; Damages; Software;
    All these keywords.

    JEL classification:

    • D40 - Microeconomics - - Market Structure, Pricing, and Design - - - General
    • K40 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - General
    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law
    • L20 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - General
    • Z10 - Other Special Topics - - Cultural Economics - - - General

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