Can imitation and counterfeiting benefit the manufacturers of the original products ? A critical analysis of the arguments

L’imitation et la contrefaçon peuvent-elles être bénéfiques aux firmes originales ? Une analyse critique des arguments

Insaf Bekir, Sana El Harbi and Gilles Grolleau ()
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Insaf Bekir: Université de Sousse
Sana El Harbi: Université de Sousse

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Abstract: Copy and counterfeiting in the fashion and luxury sector are frequently considered as reprehensible activities that harm the genuine firms. Our contribution reviews the different mechanisms and rationales supporting the idea that genuine firms may profit from the counterfeiting and imitation of their products. Most arguments raised to support the idea that imitation and counterfeiting may be profitable for the imitated firms relate either to the sampling and exposure effects or the learning by doing effect or the possibility of enhancing a monopolist's pricing power by allowing it to overcome Coase's time-inconsistency. Moreover, imitators are not only copiers, they frequently possess scarce skills and a creative capital that can be freely and profitably re-appropriated by the original firms. Counterfeiters can also inspire high-end designers of imitated firms in new directions that were not explored before. Some authors treating with status conferring goods in the fashion world have proposed that some kinds of imitation can create a flattery effect that increases the snob value of originals or speed up the fashion cycle by destroying the status value of the original, thereby generating demand for new items from the original producers. Lastly, some contributors stress that imitated firms can increase their profits by shaping and pocketing the penalties imposed on their imitators and others suggest that reciprocal imitation can be analyzed as a collective insurance mechanism. Beyond these theoretical arguments, we also devote some attention to their relevance in the real world. We contend that empirical contributions are too scarce to provide a reliable basis for practical recommendations.

Keywords: CONTREFACON (search for similar items in EconPapers)
Date: 2009
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Published in Revue internationale de droit économique, 2009, 23 (1), pp.51-65. ⟨10.3917/ride.231.0051⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-02657781

DOI: 10.3917/ride.231.0051

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