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Ebay Vs. The World: An argument for counterfeit goods

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I figured we chime in on the Ebay vs. luxury designers debate. In a nutshell, the luxury designers are suing Ebay for allowing the sale of counterfeit goods on their website. The argument has been going back and forth with Ebay losing in French court to LVMH and Ebay’s recent victory over Tiffany’s. At the heart of the debate: who’s responsibility is it to police the sale of counterfeit goods: Ebay or the luxury designers themselves? But that question is really beyond my interest.

What I really want to talk about is the nature of counterfeit goods and luxury goods and why I think it should not be policed at all. In economic terms, there would not be a supply of counterfeit goods if there was no demand. Obviously, there is a demand for counterfeits because people keep buying them. Does it take away from the profits of the large luxury corporations? Maybe. But it could be said that the utility of luxury goods has been inflated ever since the idea of luxury was thought of. Luxury is meant to create a feeling of elitism and serve as a marker of wealth. All one has to do is pay whatever price the luxury corporations deem is necessary to create this feeling of luxury, while still keeping costs into account. If the buyer feels that the high price is justified to pay for the utility of luxury, then the buyer will pay that price. This is at the heart of the debate between luxury and counterfeits.

Counterfeits offer a strikingly similar product of luxury, but may use lower quality materials and may probably be inaccurate in capturing the subtle details that the luxury houses pride themselves on. Counterfeit goods also produce a certain amount of utility, which is pretty much arbitrary. A buyer might pay for a counterfeit good, feeling good that he/she has a knockoff that costs a quarter of the price of the original.

I would argue that counterfeits are a good thing. The only ethical issue I see with counterfeits is jacking someone else’s design. But really, let’s not turn our heads away from the fact that Murakami took a camouflage design, stuck the LV logo on it, and called it “Monogramouflage” in order to charge a ridiculously high price for it. Counterfeits are doing a service to customers. Why should people be excluded from knowing a faint taste of luxury? They know it’s fake when they buy it. All they want to do is walk in a rich person’s shoes. Let’s not take that away from them.

And Ebay would be considered a market’s market. People will pay for exactly what they think a product is worth, whether it’s a counterfeit or not. Suing Ebay is not going to change the fact counterfeit suppliers are going to give the people what they want. If it’s not Ebay, it’s definitely going to be some other website selling the goods.

Long story short, if people want luxury goods, they’ll pay for it because it’s worth the price. If it’s not worth the price, then they won’t and the greedy luxury houses do not deserve a penny for offering a product that the people are unwilling to vote for with their dollars.

[Image source: Hiroko Masuike for The New York Times]

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4 Comments

  1. Posted July 15, 2008 at 1:39 pm | Permalink

    Hmm intersting point – I rarely see bloggers siding with the counterfeiters themselves. I’m not sure what I believe though.

  2. Posted July 15, 2008 at 10:36 pm | Permalink

    INTERESTING. i find myself agreeing with you on most points

    but i dunno if i’d agree with counterfeiting being a good thing, at least not ALWAYS. but yes, in the case of luxury lines, i have NO sympathy for anyone charging triple digits for handbags the size of tic-tac cases.

    if you create a comparable or strikingly similar product, i say its fair game. but i agree that stealing a logo or otherwise trying to explicitly market or display a counterfeit with a brand name, you cross the line.

    it’s like those imitation colognes they used to advertise saying “it smells just like ck one!… BUT FOR THE RECORD IT’S NOT CK ONE…”

    i say, it’s not ebay’s job to police the practices of manufacturers. if anything, luxury houses have the right to sue counterfeiters infringing upon the brand or logo, and NOT ebay.

    but again, NO sympathy.

  3. Posted July 16, 2008 at 6:48 am | Permalink

    WTF, no counterfeit goods means no orders for my factories. Which means Imelda must lay off entire villages of people. It’s so typical of selfish 1st world companies. It’s fine to exploit the 3rd world but when the 3rd world turns the tables things get nasty (ms jackson). if this does go down, I’ll simply relocate to the 4th world – where labour is even cheaper.

  4. casanovaruffin
    Posted July 16, 2008 at 9:58 am | Permalink

    HAHAHAHAHAHA Imelda, you’re the dopest!!! The 4th World sounds like a large dirt pit.


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