Although policy debates treat counterfeiting as a homogeneous wrong, this article invites us to rethink this dominant view by focusing on the special and interesting case of counterfeits of luxury goods. Section 2 proposes a taxonomy that classifies counterfeits by deception, consumer risk, and product type. This taxonomy brings to sharp relief that a single moral verdict cannot apply across pharmaceuticals, electronics, and fashion items. Section 3 delves into the nature of luxury goods, positional goods whose high prices and restricted availability reinforce social stratification and hinder relations of equality. In section 4 we argue that, because luxury brands depend less on innovation than on manufactured scarcity and status signaling, the usual justification for protecting intellectual property rights is significantly weaker in the case of luxury brands.
The paper evaluates objections to our proposal concerning the way in which IP protections encourage luxury brands to be sustainable, provides economic benefits to society, help to avoid consumer deception, and prevents exploitation in the supply chains. We argue that most problems are overstated or rooted in the illicit status of counterfeiting and, as a consequence, that the ethical case against counterfeit luxury goods warrants significant reassessment.