Counterfeiting, Piracy And Their Effects On The Economy
Criminal networks thrive by producing and trading in counterfeit and pirated goods. These products are often substandard and can raise health or safety risks which could even be life-threatening. This is particularly true for counterfeit pharmaceuticals, food and drink items, medical equipment, vehicle spare parts, toys and even tobacco products.
There are two sub-markets of counterfeit and pirated products. One consists of consumers who believe they are buying a genuine product while the other includes customers well aware of the fact that they are buying counterfeit and pirated products, but are probably looking to find a bargain. The differentiation between this two markets is intimately connected to deceptive and non-deceptive counterfeiting. It may not be possible for consumers to establish if a pharmaceutical product contains the correct active ingredients and they may be deceived while, on the other hand, fashion shoppers would know the difference between a genuine and a counterfeit pair of shoes and would not be deceived.
Intellectual Property rights (IPRs) encourage creativity, research and innovation but counterfeit and pirated goods pose a genuine and severe threat to IPRs. A significant number of organizations make huge profits as a result of their production and trade in counterfeit or pirated products, all of this at the expense of legitimate right holders. The market for counterfeit and pirated goods nick the market share from legitimate businesses, but it also undermines innovation and has a negative impact on economic growth...
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