Using data on software piracy, we examine how protection of intellectual pr
operty varies across countries. Consistent with Other studies, we find that
intellectual property receives greater protection in developed economies;
high-income countries have lower piracy rates. We also find that protection
depends on cultural factors. Countries with an individualist culture have
lower piracy rates than do countries with a collectivist culture. Piracy ra
tes are also lower in countries that have strong institutions that enforce
contracts and protect property from expropriation. These results suggest th
at national policies toward intellectual property reflect not only economic
concerns but also national culture and institutions.