IPI Publication Press Release
IPI Issue Brief
Related Publication Title:
The Real Economic Costs of the Microsoft Decision
Released by Sonia Hoffman on 10/02/2000
IPI Issue Brief
Related Publication Title:
The Real Economic Costs of the Microsoft Decision
Released by Sonia Hoffman on 10/02/2000
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Study Estimates Losses for Workers, Investors, and Federal and State Governments
For Immediate Release: Monday, October 2, 2000
For more information: Sonia Hoffman
(888) 557-4IPI or shoffman@ipi.orgDallas, TX: With all the fuss over repercussions from the Microsoft court decision, one glaring factor has remained largely overlooked: The real economic cost of the actions already taken against Microsoft.
According to a new study by the IPI Center for Technology Freedom, the damage already done to the economy will cost the average American $507 in foregone goods and services and the economy will lose 44,900 jobs.
“Investor fears over what might happen to the future profitability and viability of the software giant have increased risk, and with it, the cost of U.S. capital,” say IPI Senior Research Fellows Gary and Aldona Robbins, well-known economists and authors of the study. “Workers, savers and investors – and even the government in the form of reduced tax revenue -- will suffer the consequences of these higher capital costs.”
If the government prevails in its attempt to control the intellectual property of Microsoft, the Robbins’ estimate that over the next several years (2000 to 2010):
· GDP will drop by $147.2 billion. By 2010, the annual loss would be $20.1 billion;
· Personal income will be lower by $59.6 billion;
· Gross saving will fall by $77.6 billion;
· Investment will fall by $65.8 billion; and,
· U.S. exports will decrease $14.6 billion
The court decision will also cost federal and state governments at least $52.5 billion in foregone tax revenue. Federal receipts would decline by approximately $34.1 billion and those of states and localities by $18.4 billion.
“If the result of the antitrust lawsuit is a quarter drop in Microsoft’s market value, then individuals and governments should expect less in their pocketbooks,” say the Robbins.
This information is taken from the IPI Center for Technology Freedom’s newest Issue Brief, “The Real Economic Costs of the Microsoft Decision” by Gary and Aldona Robbins. For copies or further information, visit www.ipi.org or call Sonia Hoffman at (972) 874-5139. The authors are available for interviews.
