Detection Strategy in the Software Industry: When Should a Firm Close One Eye?

概要

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This paper shows that a selective piracy-detection strategy for the monopolist is rational in a reproducible software market. Different detection strategies and the corresponding price/penalty strategies adopted by the monopolist, with the considerations of detection costs and network externality, are demonstrated in a simplified two-period model. Under some specific circumstances, the software monopolist could gain a higher profit if not detecting piracy (closing one eye) at the beginning but detecting it (opening the other eye) later. In short, detection strategies would be time-inconsistent. Moreover, from the social planner’s perspective, the monopolist’s best detection strategy is not always socially optimal; that is, not-enforcing copyright protection may be privately and socially beneficial.
東北大学の論文
2009-03-01