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Criminal Enforcement of Intellectual Property Law – An Economic Approach

With piracy and counterfeiting constituting an ever-growing international phenomenon that threatens the world social and economic order, criminal sanctions in intellectual property law are fervently debated as to their aptitude to address particular infringement situations. A "beacon of hope" for guidance in this highly contentious law and policy area is the economic approach to law. However, the area of criminal enforcement of IP law is still a closed book and has carelessly been neglected by economic research. In the light of this scarcity of economic research, this paper, first, discusses the state of economic research on criminal enforcement of IP law. It reviews the economic analysis of criminal sanctions in research, law, policy, and enforcement before suggesting relevant issues and questions to be addressed by economic research. This paper provides, second, for an introduction to the learnings from the economics of crime and punishment and discusses their applicability to IP law. It focuses thereby in particular on economic rationales for the criminal enforcement of IP law and optimal levels of punishment. This paper discusses, third, the limitations of the economic approach to criminal sanctions in IP law before closing with the suggestion of a future research agenda for economists. In summary, this paper constitutes a strong plea for both social economics research, behavioural approaches, and empirical economic research for the assessment of criminal sanctions in IP law while critically acknowledging the limitations of an economic analysis of criminal law.