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The Luxury Economy and Intellectual PropertyCritical Reflections$
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Haochen Sun, Barton Beebe, and Madhavi Sunder

Print publication date: 2015

Print ISBN-13: 9780199335701

Published to Oxford Scholarship Online: October 2015

DOI: 10.1093/acprof:oso/9780199335701.001.0001

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PRINTED FROM OXFORD SCHOLARSHIP ONLINE (oxford.universitypressscholarship.com). (c) Copyright Oxford University Press, 2021. All Rights Reserved. An individual user may print out a PDF of a single chapter of a monograph in OSO for personal use. date: 18 June 2021

The Economics of Demand for Counterfeiting

The Economics of Demand for Counterfeiting

Chapter:
(p.57) 4 The Economics of Demand for Counterfeiting
Source:
The Luxury Economy and Intellectual Property
Author(s):

Yi Qian

Publisher:
Oxford University Press
DOI:10.1093/acprof:oso/9780199335701.003.0004

This chapter provides a theoretical framework to conceptualize the potential sales impacts of counterfeiting. It models a branded firm with multiple product lines under both monopoly and competition conditions, and derives the equilibrium demand for the authentic and counterfeit products. It shows that in certain situations counterfeits may actually work to the benefit of the company whose products are being counterfeited. When the authentic goods are of very high quality, low quality counterfeits will not substitute for authentics and may help to advertise them. But where authentics and counterfeits are of similar quality, producers of authentics will be negatively impacted.

Keywords:   counterfeit goods, fake goods, luxury goods, counterfeiting, sales impact, authentic goods

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