engleski

The effects of product counterfeiting

The chapter deals with the concept of intellectual property and trademark from a legal and economic point of view with an aim to explore the commercial effects of trade in counterfeit goods. A more affordable price of fake luxury goods and the increasing ease of online trading are the main reasons for the growing demand in counterfeit products. However, inferior quality of such products and non-standardized production processes may pose a substantial risk to the health and safety of consumers. The direct commercial impacts of trade in counterfeit goods on the trademark owner’s company are the lost revenue, potential price decrease and damage to brand reputation. For this reason, a previously developed econometric model that takes into account economic and counterfeiting phenomena variables was used in the empirical section of the chapter. The aim was to determine the negative economic impacts of counterfeiting in relative and absolute terms of lost revenue in the sportswear, cosmetics and luxury bags markets. The interpretation shows that revenue losses on the Croatian market due to trade in counterfeit goods in these categories reach almost 10%, consequently reducing job creation, tax revenues and consumer spending.

counterfeit goods, intellectual property rights, trade, consumer safety

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