Counterfeit Goods and Income Inequality
This paper examines the effect of counterfeit goods in a world where consumers are differentiated by level of income and innovation is quality enhancing. Counterfeit goods are defined as products with the same characteristics as “originals”, but of lower quality. The effect of imitation on firms’ pr...
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| Format: | eBook |
| Language: | English |
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Washington, D.C.
International Monetary Fund
2001
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| Series: | IMF Working Papers
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| Collection: | International Monetary Fund - Collection details see MPG.ReNa |
| Summary: | This paper examines the effect of counterfeit goods in a world where consumers are differentiated by level of income and innovation is quality enhancing. Counterfeit goods are defined as products with the same characteristics as “originals”, but of lower quality. The effect of imitation on firms’ profits and consumer welfare depends on the distribution of income within the country. In particular, the greater the level of income inequality the larger the increase in consumer welfare due to the imitation, and the smaller the effect on profits of the state-of-the-art firm |
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| Physical Description: | 23 pages |
| ISBN: | 9781451843002 |