I personaly pirate most of my games, simply because I do not have the spare money lying around to buy all the stuff I'd like to try out. When I do buy a game, i have to very carefully consider it and usualy they last me a very long time. Being a college student in a central european country, I don't exactly have a lot of money lying around, not to mention the fact that wages in Hungary are way lower compared to Western European countries while game prices remain pretty much the same. Steam knocking off like 5 euro's off the price of a game because I'm in region 2 realy doesn't compensate for that.
Fact of the matter is, I'm not a lost sale, simply because I wouldn't have bought it in the first place, and considering a large demographic who plays video games are college/uni students who are tight on money, I'm sure I'm not alone on this.
For references sake, minimal wage in Hungary is 564-656 forints an hour, which is about 2 euros.