Graduated response policies to digital piracy: Do they increase box office revenues of movies?

- Six countries' graduated response policies examined in the theatrical film industry.
- Large sample of film-level data employed covering 16 countries over years 2005-2013.
- No support found for increased revenues after policy interventions in any market.
- Range of robustness checks confirm no increase in revenues in any market.

This study investigates the impact of six countries' graduated response policies to digital piracy-sometimes referred to as 'three-strike' policies-on film-level theatrical box office revenues. Applying a quasi-three-way effects difference-in-difference model, no compelling evidence of increasing revenues is observed in any of the markets considered. This finding brings into question the efficacy of graduated response laws if one of the primary objectives is to increase sales in legitimate markets.