Essays on the Role of Knowledge in Recent Chinese Development

Chapter 1: Earlier studies have consistently found evidence for productivity externalities of FDI through backward linkages. However, most studies do not use direct measures of backward linkages, nor do they further investigate what exactly generates these productivity externalities. Using a unique dataset from the Chinese automotive industry, which provides direct supply linkage measures, this study shows that compared with suppliers that only sell to domestic brands, the total factor productivity premium is about 16.7 percent for auto parts suppliers that sell to at least one foreign brand. Employing difference-in-differences estimation, a causal link from backward linkages to the suppliers\u27 productivity growth is also established. Specifically, auto parts suppliers\u27 productivity grows by 25.5 percent in the first year after formal supply relationships are forged with foreign joint venture automakers, and productivity continues to grow at least over the next two years. The case study further identifies knowledge transfer from joint venture automakers as an important source of productivity gains in local suppliers. It also offers three caveats that need to be taken into account when interpreting the observed productivity externalities in the econometric analyses. Chapter 2: Intellectual property piracy is widely believed, by authorities in both U.S. industry and government, to be rampant in China. Because we lack evidence on the rate at which unpaid consumption displaces paid consumption, we know little about the size of the effect of pirate consumption on the volume of paid consumption. We provide direct evidence on both the volume of unpaid consumption and the rate of sales displacement for movies in China using two surveys administered in late 2008 and mid-2009. First, using a survey of Chinese college students\u27 movie consumption and an empirical approach parallel to a similar recent study of U.S. college students, we find that three quarters of movie consumption is unpaid and that each instance of unpaid consumption displaces 0.14 paid consumption instances. Second, a survey of online Chinese consumers reveals similar patterns of paid and unpaid movie consumption but a displacement rate of roughly zero. We speculate on the small displacement rate finding relative to most of the piracy literature

Essays on the Economics of Digital Piracy

My thesis consists of three chapters relating to the economics of digital piracy. Digital piracy is a debated topic catching tremendous academic and public attention. My studies contribute to the understanding of the impact of digital piracy on legitimate sales revenue with a focus on the motion picture industry. In my first chapter, I examine the effects of screener piracy on the movie box office. Screeners are movie copies sent to critics and industry professionals for evaluation purposes. Sometimes, screeners are leaked and made available to download on the Internet. This chapter exploits the plausibly exogenous variation of file sharing/piracy activities caused by screener leaks of Oscar-nominated movies to estimate the impact of movie piracy on box office revenue. Using information on leak dates collected from \textit{thepiratebay.org}, I compare the box office performance of leaked and non-leaked movies both cross-sectionally and employing a difference-in-difference strategy to identify the causal effect of piracy on movie box office. I find evidence that screener piracy reduces the box office revenue of the leaked movie in subsequent weeks. However, the negative impact depends on the timing of leaks. Damages to the total box office for movies with late leaks are much smaller compared to pre-release screener leaks. One reason behind the lack of consensus regarding the impact of piracy in the empirical literature is the dearth of data on actual piracy activity. Data limitation restricts most empirical researchers to reduced-form and quasi-experimental methods, where estimates on industry loss may be biased due to extrapolation of the local average treatment effects on the population. To deal with the data challenge, in the next two chapters I have collected a dataset of weekly illegal downloads on BitTorrent in the United States from 40,267 torrent files for 255 movies released between March 27th and December 27th, 2015. Being able to directly observe piracy activities, my studies avoid many issues such as measurement error or sample selections which exist in studies using proxies or conjoint surveys. In my second chapter, I utilize this novel dataset of illegal movie downloads to estimate a random-coefficient demand model of movie consumption. Using counterfactual experiments, I quantify the effects of piracy on movie box office revenue. The model distinguishes two channels of piracy substitution effects: (1) intra-movie substitution effects, which are the focus of most previous literature; and (2) inter-movie substitution effects, which represent the spillover of one title\u27s piracy to the other titles\u27 revenue. While the latter channel has been rarely explored in the literature due to restrictions imposed by data and methods, the novel dataset and demand model allow me to quantify its relative impact. I find that the revenue loss due to piracy\u27s inter-movie substitution is on average 4 times as large as the intra-movie substitution effects. Omitting inter-movie substitution severely underestimates the actual damage of piracy. Other counterfactuals show that piracy reduces the total box office revenue of the motion picture industry by $93 million in total, 1.09% of the current box office. In my third chapter, I extend the result of my second chapter by considering heterogeneity in the effects of piracy. Based on the data and methodology employed in the second chapter, I utilize information on video quality of illegal files to separate piracy by video quality. Augmented by data on home-video sales, I quantify the heterogeneous effects of piracy by distributional channels and video quality. In addition, a heatedly debated topic on digital piracy is about the potential positive effects of piracy due to channels like word-of-mouth. I incorporate the word-of-mouth effects of piracy in my model and quantify the contribution of piracy\u27s word-of-mouth on movie sales revenue. I find that piracy\u27s effects are large on the home-video market and small on the theatrical market. For high-quality piracy, substitution effects dominate word-of-mouth effects. For low-quality piracy, substitution effects are dominated by word-of-mouth effects which make low-quality piracy a potential promotional tool for studios

Movie Piracy and Displaced Sales in Europe: Evidence from Six Countries

This paper presents estimates of lost movie sales due to unpaid movie consumption. We are the first to provide estimates that are recent, representative of the internet-using population, and cover multiple countries. Based on an online questionnaire with almost 30,000 respondents, we document that one unpaid (first) viewing of a movie displaces about 0.37 units of paid viewings. Using a back-of-the-envelope calculation, we show that this implies that unpaid movie viewings reduced movie sales in Europe by about 4.4% during the sample period. Lost sales differ substantially by country: they are in the range of 1.65% for Germany and 10.4% for Spain. We also find that 94% of lost sales are due to unpaid viewings by a small group of only 20% of consumers. Our findings have important implications for copyright policy

Factors influencing buying behavior of piracy products and its impact to Malaysian market

The primary attempt in this study was to explore the influencing factors of the Malaysian consumers toward the pirated products. To explore these factors, this study has conducted a survey among the Malaysian consumers. The results of the study showed that there is significant relationship between the consumers’ perception and the social influence, personality or believe, pricing and the economy toward the piracy. Results also show that society has strong influence on the consumers’ personality and believes, that leads to grow consumers’ perception. On the other hand, it is revealed that most of the respondents are willing to buy pirated product because cost effective. Since, price plays a key role to convey individuals toward price sensitive, therefore it is important for the marketers or producers to be attentive of pricing. More importantly marketer can decrease the production cost and secondly, they shows intention to reduce their profit margin. To perform all those necessary steps need to set up the price by considering the all income groups. That will help to reducing the consumers’ consumption of pirated goods. Though, there is no doubt about the quality of original products but they should look at the price

Digital music consumption on the Internet: Evidence from clickstream data

The goal of this paper is to analyze the behavior of digital music consumers on the Internet. Using clickstream data on a panel of more than 16,000 European consumers, we estimate the eects of illegal downloading and legal streaming on the legal purchases of digital music. Our results suggest that Internet users do not view illegal downloading as a substitute to legal digital music. Although positive and signicant, our estimated elasticities are essentially zero: a 10% increase in clicks on illegal downloading websites leads to a 0.2% increase in clicks on legal purchases websites. Online music streaming services are found to have a somewhat larger (but still small) eect on the purchases of digital sound recordings, suggesting complementarities between these two modes of music consumption. According to our results, a 10% increase in clicks on legal streaming websites lead to up to a 0.7% increase in clicks on legal digital purchases websites. We nd important cross country dierence in these eects.JRC.J.3-Information Societ

Movie Piracy and Displaced Sales in Europe: Evidence from Six Countries

This paper presents estimates of lost movie sales due to unpaid movie consumption. We are the first to provide estimates that are recent, representative of the internet-using population, and cover multiple countries. Based on an online questionnaire with almost 30,000 respondents, we document that one unpaid (first) viewing of a movie displaces about 0.37 units of paid viewings. Using a back-of-the-envelope calculation, we show that this implies that unpaid movie viewings reduced movie sales in Europe by about 4.4% during the sample period. Lost sales differ substantially by country: they are in the range of 1.65% for Germany and 10.4% for Spain. We also find that 94% of lost sales are due to unpaid viewings by a small group of only 20% of consumers. Our findings have important implications for copyright policy

Essay in Family Economics and Media Economics in China

abstract: Family economics uses economic concepts such as productions and decision making to understand family behavior. Economists place emphasis on the rule of families on labor supply, human capital investment, and consumption. In a household, the members choose the optimal time allocations between working, housework and leisure, and money between consumption of different members and savings. One-Child policy and strong inter-generational connections cause unique family structure in China. Households of different generations provide income transfer and labor support to each other. Households consider these connections in their savings, labor supply, human capital investment, fertility and marriage decisions. Especially, strong intergenerational relationships in China are one cause of the high level of young female labor supply and high saving rate. I will investigate the rules of intergenerational relationships on household economic behavior. Affirmative Action allocates college seats to a separate group. To evaluate the distribution effects of AA on discrete groups, we need to study household's strategic reactions on the rule of college seats allocation. The admission system of National College Entrance Examination in China is a type of AA. That distributes college seats by regions. I will use the rapid expansion of Chinese college enrollment as a natural experiment to check the households' reaction on AA and college expansion. Media economics utilizes economic empirical and theoretical tools to figure out the social, cultural, and economic issues in media industries. The impact of online piracy on genuine products sales is under debate, because people cannot find representing proxies to evaluate piracy levels. I will use Chinese data to study the effects of online piracy on theater revenue.Dissertation/ThesisDoctoral Dissertation Economics 201

Essays on the demand for information goods

siirretty Doriast

To Root or Not to Root? The Economics of Jailbreak

We construct a structural model that allows us to jointly estimate the demand for smartphones and paid apps using a Bayesian approach. Our data comes from more than 500 college students in Hong Kong and Shanghai. We find that the moral cost rather than the monetary cost of jailbreaking smartphones determines its prevalence. Users mainly jailbreak smartphones to use paid apps for free, a reason more important among Android users than iPhone users. Paid apps contribute the lion's share of the profits (between 53% and 71%) for both the Android and iPhone. Strictly prohibiting jailbreaking would decrease the aggregate market share of smartphones in the cell phone market. Apple, however, would sell even more iPhones at the expense of Android smartphones

Measuring Infringement of Intellectual Property Rights

© Crown Copyright 2014. You may re-use this information (excluding logos) free of charge in any format or medium, under the terms of the Open Government Licence. To view this licence, visit http://www.nationalarchives.gov. uk/doc/open-government-licence/ Where we have identified any third party copyright information you will need to obtain permission from the copyright holders concernedThe review is wide-ranging in scope and overall our findings evidence a lack of appreciation among those producing research for the high-level principles of measurement and assessment of scale. To date, the approaches adopted by industry seem more designed for internal consumption and are usually contingent on particular technologies and/or sector perspectives. Typically, there is a lack of transparency in the methodologies and data used to form the basis of claims, making much of this an unreliable basis for policy formulation. The research approaches we found are characterised by a number of features that can be summarised as a preference for reactive approaches that look to establish snapshots of an important issue at the time of investigation. Most studies are ad hoc in nature and on the whole we found a lack of sustained longitudinal approaches that would develop the appreciation of change. Typically the studies are designed to address specific hypotheses that might serve to support the position of the particular commissioning body. To help bring some structure to this area, we propose a framework for the assessment of the volume of infringement in each different area. The underlying aim is to draw out a common approach wherever possible in each area, rather than being drawn initially to the differences in each field. We advocate on-going survey tracking of the attitudes, perceptions and, where practical, behaviours of both perpetrators and claimants in IP infringement. Clearly, the nature of perpetrators, claimants and enforcement differs within each IPR but in our view the assessment for each IPR should include all of these elements. It is important to clarify that the key element of the survey structure is the adoption of a survey sampling methodology and smaller volumes of representative participation. Once selection is given the appropriate priority, a traditional offline survey will have a part to play, but as the opportunity arises, new technological methodologies, particularly for the voluntary monitoring of online behaviour, can add additional detail to the overall assessment of the scale of activity. This framework can be applied within each of the IP right sectors: copyright, trademarks,patents, and design rights. It may well be that the costs involved with this common approach could be mitigated by a syndicated approach to the survey elements. Indeed, a syndicated approach has a number of advantages in addition to cost. It could be designed to reduce any tendency either to hide inappropriate/illegal activity or alternatively exaggerate its volume to fit with the theme of the survey. It also has the scope to allow for monthly assessments of attitudes rather than being vulnerable to unmeasured seasonal impacts