Globalization and software piracy within and across 103 countries

Abstract

Globalization has been linked with many social problems, though little research has examined its relationship with software piracy. The ramifications of software piracy may vary across countries leading to varied criminal justice responses. More developed countries, which produce the most software and stand to gain the most from its protection, use diplomatic leverage to strengthen piracy laws in less developed countries. Consequently, lesser-developed countries are forced to adopt rigorous policies for IP protection. As such, we hypothesize that globalization will decrease software piracy rates over time. Using a modified random effect model, the current study examines the within and between countries effects of globalization on software piracy rates over time in 103 countries across a period of 14 years. Results indicate that globalization is significantly associated with a decrease in software piracy within and between countries over time while controlling for important time-varying and time invariant predictors. Interaction effects suggest that the relationship between globalization and software piracy is less pronounced in Asian countries and more pronounced in Latin American countries. In sum, some crimes, like software piracy, may be deterred if there are strong enough incentives and international pressures to regulate such crime through legislative and policy reforms.