Determinants of worldwide software piracy losses

Abstract

This paper studies the determinants of software piracy losses along five major macroeconomic dimensions: Technological, Educational, Institutional, Access to Information and Labor force. The study was conducted based on a large dataset available from 1995 to 2010 and comprising 81 countries. As for the Technological dimension, more patents by residents increases piracy losses while the effect of R&D is the opposite (decreases piracy losses). In terms of the Educational dimension, the results show that more spending on education increase the piracy losses but, at the same time, more schooling years have the contrary effect. Concerning the Institutional dimension, nations with less corruption have lower piracy levels. Regarding the Access to Information, it seems that access to Internet diminishes the losses while the share of Internet broadband subscriptions has no effect. The results also show that, regarding the Labor dimension, employment in services has a deterrent effect while labor force with higher education and youth unemployment increases piracy losses.