Piracy in the Entertainment Industry: How does the strength of intellectual property rights impact royalty payments to the United States?

The entertainment industry is one of the largest industries worldwide and is also one of the largest markets subject to piracy.  This market is valued at $632 billion but it is estimated that about $250 billion are lost each year due to piracy, and this number is predicted to rise in coming years.  Due to this, both the industry and economy suffer from a loss of revenue because countries fail to repay their royalties.  It is believed that part of the reason for piracy can be attributed to weak intellectual property rights (IPRs).  This research investigates how different measures of IPRs influence international royalty payments in the entertainment industry.  The data was collected from various sources such as the World Bank, the Bureau of Economic Analysis, the Office of the United States Trade Report, and the World Trade Organization.  By running series regressions, it was found that IPR measurements have significant interactions with royalty payments when looked at individually.  Television royalty payments were most affected by IPRs, but audiovisual royalties, sound royalties, and broadcasting royalties were also affected.  Although constant variables absorb some of the significance, these results are consistent with the idea that stronger IPR protection has a positive association with royalty payments.