Complementarity in public and private intellectual property enforcement; implications for international standards

Michael Klein

Oxford Economic Papers, 2020, vol. 72, issue 3, 748-771

Abstract: I examine the relationship between public enforcement of intellectual property (IP) rights and firm strategies to influence entry of non-deceptive counterfeit products: illegal copies of authentic goods purchased consciously by consumers. I assume that private enforcement investment determines the probability that a counterfeit entrant will be detected, while public investment determines the efficacy of the legal institutions responsible for enforcing IP law. Private and public enforcement serve distinct complementary roles, which combine to determine total IP protection in the economy. I show that differences in the investment incentives of the two entities that control enforcement lead to inefficiently low public investment in equilibrium. In this context, international efforts to impose stricter legal penalties against counterfeiters can be counterproductive: further reducing public enforcement and increasing counterfeit prevalence. In contrast, minimum quality standards can be implemented to better align incentives, encourage higher public enforcement, and reduce inefficiency.

JEL-codes: D23 K42 L43 O34 (search for similar items in EconPapers)
Date: 2020
References: Add references at CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://hdl.handle.net/10.1093/oep/gpaa001 (application/pdf)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:oup:oxecpp:v:72:y:2020:i:3:p:748-771.

Ordering information: This journal article can be ordered from
https://academic.oup.com/journals

Access Statistics for this article

Oxford Economic Papers is currently edited by James Forder and Francis J. Teal

More articles in Oxford Economic Papers from Oxford University Press Oxford University Press, Great Clarendon Street, Oxford OX2 6DP, UK.
Bibliographic data for series maintained by Oxford University Press ().