The purpose of this note is to address foreign countries that harbor counterfeiters that by association indirectly support the act of piracy. This piece of literature further argues that the primary effect of piracy on foreign economies would seem to be a substitution of sales and profits away from American subsidiaries to locally owned companies. With this movement of sales, this substitution contributes to a reduction in producers’ surplus and allows for a short run gain in profit for foreign economies. As such, this reduction in the inflow of foreign investment will strengthen the perception of those foreign countries being susceptible to piracy, labelling them as less appealing markets. The second part of the article further distinguishes the differences between government protection and market protection. The macroeconomic effects of piracy that are discussed also relay the idea that domestic consumers benefit from lower "priced" imports that are acceptible substitutes for the "original" goods. With this idea in mind, the author argues that the U.S. has a strong influence on global productivity because of its economy’s incredible efficiency. Firmly holding this notion, the author believes that greater flexibility in distribution techniques can mitigate piracy problems. Though this article does not address peer-to-peer file sharing directly, it seems obvious that this issue would be heavily implicated in piracy and copyright infringement.

The future of file sharing seems bleak considering that the U.S. has decided to form alliances with other nations in order to rally support against broad-range piracy. This article in particular addresses the act more and strongly defines what constitutes an act of piracy and the damaging effects on various economies. I found this to be of use since it defined the umbrella term of piracy and how file sharing could be grouped within this category, since shared material appears to be the "lower" priced import. The notes following the read provide more legislative material to justify the claims of the author. Either way, this piece provides information about preliminary control over piracy issues and future implications that may result from actions taken by larger corporations and organizations.

The Organization for Economic Co-Operation and Development, made up of thirty democracies, focuses on issues facing the economy, the society, and the environment due to globalization. Their executive summary aims to identify the economic impact of counterfeiting and piracy. In 2005, they found that pirated and counterfeited products amount to $200 billion, ecxluding trade conducted through the Internet. To put this number into context, the report states that the amount is larger than the GDPs of 150 economies. They found that piracy operations are in large led by organized crime such as gangs and terrorist groups. Only groups with financial stability and vast distribution networks would be capable of controlling such a market. Even though certain target groups have been identified, it is still difficult to catch and combat these pirates.While piracy exists in all economics, it is most pronounced in developing countries. The report calls upon governments to strengthen law enforcement and regulation to diminish these networks.

While some counterfeit goods could potentially be harmful to ones health, such as counterfeit pharmaceutical drugs, other pirated goods such as movies serve to decrease economic growth and discourage creativity. Due to the Internet, new distributions outlets are available for pirated material. As the report emphasizes, the Internet provides an infinite market for products that can be sold through full anonymity. Not only does piracy effect copyright industries, it is also shown to effect areas of trade, the evironment, and employment as well.

The report finishes by suggesting methods to improve information on counterfeiting and piracy to better target such groups. By developing more information on the national and global level that is systematically collected, comparable, and comprehensive, there can be a uniform system for combating these illegal activties.

In my paper, I intend on identifying the challenges the movie industry faces. The data collected by the OECD provides significant insight into the nature of the groups disseminating pirated goods. In addition, their numerical figures will help me quantify the impact of their activities, economically and socially.