The impact of computer software piracy on the international economy

Unauthorized software can manifest in otherwise legal businesses that buy too few software licenses, or overt criminal enterprises that sell counterfeit copies of software programs at cut-rate prices, online or offline. However, the impact of software piracy goes beyond revenues lost to the software industry, starving local software distributors and service providers of spending that creates jobs and generates much-needed tax revenues for governments around the world. Curbing piracy has the reverse effect, sending ripples of stimulus through the whole information technology IT economy. And lowering piracy faster compounds the benefits.

The impact of computer software piracy on the international economy

Unsustainable population growth societal Critical systems failure technological The strongest connections to the five Centres of Gravity are highlighted as the dark grey, star-shaped constellation to emphasize their impact.

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Analysis of the Global Risks Map reveals four risks as playing significant roles in connecting the Centres of Gravity to each other. These four Critical Connectors, which link the main clusters of the system, are highlighted as black dots in the diagram. Severe income disparity economic Major systemic financial failure economic Unforeseen negative consequences of regulation economic Extreme volatility in energy and agriculture prices economic Weak Signals are defined as risks which are most loosely connected in the network, based on how many links they have and how often these were selected by survey respondents.

The top five Weak Signals are: Vulnerability to geomagnetic storms environmental Proliferation of orbital debris technological Unintended consequences of nanotechnology technological Ineffective drug policies societal Militarization of space geopolitical They have almost without exception received relatively low-impact and low-likelihood scores, and in most cases exhibit a significant variation in how survey respondents perceive them, particularly among the different regions.

Weak Signals will not be addressed explicitly in the cases considered in this report, though it is worth bearing in mind that some experts did rate their connectedness and severity more highly. The typology of global risks, as summarized in Figure 8enables a more structured approach to the complexity of interconnections than has been possible in previous reports.

The survey also revealed variations in the risk perceptions of different groupings of survey respondents. Self-identified experts in a category tended to perceive the likelihood and impact of a risk in their area of expertise as higher than the rest of the survey sample.

One exception to this trend was the case of technological risks, where experts often had a lower mean likelihood and impact score when compared to other respondents.

Appendix 2 identifies three cases of significant differences in risk perception: The subsequent three cases help to explain some of the potential causal relations that the survey data alone cannot substantiate and to underscore the complexity of interconnected global risks that our world faces in the next 10 years.

For more details on the five categories, Centres of Gravity and the list of global risks, refer to The Risk Categories. For the full risk landscape, refer to Figure 2. This case considers how current fiscal and demographic trends could reverse the gains brought by globalization and prompt the emergence of a new class of critical fragile states — formerly wealthy countries that descend into lawlessness and unrest as they become unable to meet their social and fiscal obligations.

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Such states could be developed economies where citizens lament the loss of social entitlements, emerging economies that fail to provide opportunities for their young population or to redress rising inequalities, or least-developed economies where wealth and social gains are declining.

This case shows that a society that continues to sow the seeds of dystopia — by failing to manage ageing populations, youth unemployment, rising inequalities and fiscal imbalances — can expect greater social unrest and instability in the years to come.

A macro and longer-term interpretation of these events highlights the need to improve the management of global economic and demographic transformations that stand to increasingly define global social trends in the decade to come.

These trends are evolving differently across developed, emerging and least developed economies. In developed economies, such as those of Western Europe, North America and Japan, the social contract that has in recent decades been taken for granted is in danger of being destroyed.

Workers nearing retirement fear cutbacks in social entitlements they have grown up to expect, such as state pensions, pre-established retirement age and guaranteed access to quality healthcare.

The impact of computer software piracy on the international economy

Meanwhile, young adults in this same group of economies realize that they are part of a compressed labour force that is expected to support a growing population of elderly citizens, while bearing the brunt of austerity measures required to offset growing national debts. At the same time, these same youths must save enough to provide for their own old-age needs in the most challenging economic climate in a generation.

In emerging economies, the context — and the challenge — is different. Countries such as Indonesia, Vietnam, the Philippines, Mexico, Peru and the BRIC countries Brazil, Russia, India and Chinaare racing to take advantage of a demographic window of opportunity presented by large labour forces with relatively few dependents, before this population also ages.

Rapid economic growth in emerging economies has fuelled an impatient expectation that a rising tide will lift all boats, but social contracts may not be forged quickly enough to rectify increasingly visible economic inequalities and social inequities.

Failure to meet demands for civil and political rights could also have harmful consequences. Figure 9 shows that in most countries, improvements in economic living standards have been accompanied by increases in political and civil rights such as freedom of speech, assembly and belief.

In approximately a dozen countries, citizens who have enjoyed rapid economic growth in the last 20 years have instead seen deterioration in their political and civil freedoms, often resulting in social unrest.

A closer look reveals that many countries in this group share recent episodes of social unrest as a common characteristic. Least-developed economies and fragile states, such as Afghanistan, Pakistan, Timor-Leste and many Sub-Saharan African countries, are still struggling to ensure basic health and education for their growing populations and to take advantage of the wealth-generating potential of women.

The three distinct economic and demographic contexts described above are linked by migration. Across the globe, as population growth puts pressure on rural economies, people are being rapidly pulled into cities that struggle to absorb the new arrivals in an orderly way.

Figure 10 shows that the rural population is expected to decline aroundwhile the urban population will continue to increase.

Young people entering the urban labour force often find that their education has not equipped them with the technological skills and entrepreneurial know-how to access employment opportunities presented by global connectivity.

Cross-border migration adds a dynamic element to this demographic picture. If managed well, labour can be mobilized from one part of the world to another through legitimate channels that match available skills to employer demands, while also protecting the rights of migrants and their families.

In the absence of such channels, higher rates of irregular migration are likely, as is abuse by illicit migration networks and smugglers.

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Cross-border migration can therefore either be a remedy or a further complication. In addition to irregular migration, experts express greater concern about people who are unable to relocate satisfactorily, grow frustrated and drop out of the formal labour market where they reside.

When amplified by extreme demographic pressures, these conditions could lead to a retrenchment from globalization and the emergence of a new type of critical fragile states — formerly wealthy countries that descend into a spiral of decay as they become increasingly unable to meet their social and fiscal obligations.

The signs already exist that the world is becoming more fragmented, inconsistent and mistrustful; the question is the extent to which these developments could lead to a global dystopia. Trends and Uncertainties Bythe world will experience a near doubling of the urban population to 6.“It’s easy to assume, amid all the brouhaha about intellectual property, illegal downloading, and the internet in general, that the question of piracy was born with the web browser.

It is, of course, no surprise that software has such an impact on the economy. It has become an indispensible tool of the economic benefits of reducing software piracy 1.

In the 42 countries covered in this study, the figure came piracy impact study: the economic benefits of reducing software piracy 3.

Piracy Rate Total Impact. Computer Software Piracy and it's Impact on the International Economy The PC industry is over twenty years old.

In those twenty years, evolving software technology . As a consequence of global and U.S.-based piracy of sound recordings, the U.S. economy loses $ billion in total output annually.

Output includes revenue and related measures of economic performance. Business Software Alliance - Piracy Impact Study In , more than four out of 10 software programs installed on personal computers around the world were stolen, with a .

There is no question that content piracy has had a negative impact on everyone involved in the entertainment industry and on the overall global economy.

While I cannot reverse the doings of pirates, I can propose a solution to hopefully stunt the growth of piracy.

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