Institute for Strategy, Technology and Organization (ISTO)
print

Language Selection

Breadcrumb Navigation


Content

Piracy and Movie Revenues: Evidence from Megaupload

Authors/Editors: Peukert, C.
Claussen, J.
Published: 2012
Type: Articles in Refereed Journals (International)
Published by: Social Science Research Network (SSRN)

Abstract

In this paper we make use of a quasi-experiment in the market for illegal downloading to study movie box office revenues. Exogenous variation comes from the unexpected shutdown of the popular file hosting platform Megaupload.com on January 19, 2012. The estimation strategy is based on a quasi difference-in-differences approach. We compare box office revenues before and after the shutdown to a matched control group of movies unaffected by the shutdown.
We find that the shutdown had a negative, yet insignificant effect on box office revenues. This counterintuitive result may suggest support for the theoretical perspective of (social) network effects where file-sharing acts as a mechanism to spread information about a good from consumers with zero or low willingness to pay to users with high willingness to pay.

Related Links