Paper 3: Article

The emergence of counterfeit trade: a literature review

Analysis of the demand for counterfeit goods
Objectives
Trade in counterfeit goods is anticipated as a consequential threat to major companies. No
Longer is the emergence of imitation products compassed to branded luxury goods and
final markets. The articles of Counterfeit are increasingly finding their way into other
sectors, including the fast transforming in consumer goods, automotive and
pharmaceutical industries with, in part, various negative consequences for consumers,
lawful manufacturers, and brand owners alike. Those two articles of counterfeit leads to
focus on the light of the principles in economics of counterfeit trade and the underlying
illegitimate supply chains.
The distribution, production and consumption of counterfeit goods have been increasing
At an alarming rate. Existent constitution addresses the supply front of the problem, but
not the demand front of the problem. The objectives of those papers is to identify,
empirically, factors that influence on consumer demand for counterfeit goods were studied.

Research Method
An extensive literature review was attended that formed contributions from many strands
of management research. An Empirical model and analysis also for counterfeit study,
simple t-tests and logistic regression are used for the analyses in order to achieve the first
objective, t-tests are used to identify whether differences exist between purchasers and non-
purchasers of counterfeit goods with respect to their consumer attitudes about
counterfeiting. For the other objectives, a multi framework is used in order to analyze the
effect of one variable while controlling for other factors that could influence on demand.
Consequently, the dependent variable is a dichotomous variable, and logistic regression
analysis is an appropriate statistical technique (Tacq, 1997).

Sample and Data collection

Collecting data in those articles, students inducted in a major university based in a medium
sized town were inquired to complete a questionnaire. The questionnaire was conducted to
seven classes. Advantage sampling was used with the fixed of trying to have a wide
representation of students from several campus. Four classes from a fiber and apparel
department were chosen placed on the acceptance that these students were more
anticipated to have been defined to the negative forms of purchasing counterfeit goods,
compared to other students. They were also chose since the behavior of these students
would be of most direct purpose apparel and textile academicians. Withal, in order to
establish a multiple sample of students, the observe were also conducted to two large
classes, Principles of Microeconomics and Introduction to Sociology and one small class,
Introduction to Astronomy. These classes were based on their class sizes, different
educational levels, and representation of students from many different departments
throughout campus. A total of 517 students responded to the questionnaire. Withal, to be
admitted in the analyses, the students had to complete information on the variables of
interest which resulted in 437 respondents for the logistic regressions.

Descriptive statistics
The respond statistics age was 19.69 years. Almost 70 percent (69.9 percent) were female
and 30 percent male. The freshman class made up the largest group in the sample (47.52
percent), followed by sophomores (21.39percent), seniors (15.45 percent), juniors (14.26
percent) and graduate students (1.39percent). Over 40 percent (42.17 percent) of the
sample came from households with parental income of $100,000 or more. Textile and
apparel majors accounted for 26.08 percent of the sample. Almost one-third (30.35 percent)
of the sample had purchased counterfeit goods while a little over one-half (53.89 percent)
had not. Nine categories of counterfeit goods were identified as having been previously
purchased by respondents. The most commonly purchased counterfeit items were
handbags (61.84percent), music (31.58 percent), clothing (22.37 percent) and jewellery
(18.42 percent).

Results

T-tests for variables

Tom et al. (1998) A total of 12 attitudinal questions regarding counterfeit. The t-tests
showing the significant results differences between buyers of counterfeit goods and non-
buyers on 11 of the 12 attitudinal questions. There’s one question was not statistically
significant, “I like buying counterfeit products because it’s like playing a practical joke on
the manufacturer of the non-counterfeit product.” Purchasers were more effective to
explicit anti-big business sentiments, and were not likely to admit that counterfeiting hurt
the US economy. Purchasers were more admit to express that counterfeit goods are just as
good as designer goods only, and less to view counterfeiting as lawless. Hence both
purchasers and non-purchasers admire that counterfeit seller’s goods are acting a crime
relative to the buyers of counterfeit goods. Moreover Logistic regression results of income
was not a significant touching the purchases of counterfeit goods. Withal, in the first
regression equation, one income category, parental income over $100,000 was significant.
The odds ratio shows that students with parents in this income bracket were 99 percent
more behavior to buy a counterfeit product compared to students with parental income of
less than $25,000. This positive effect does submit that counterfeit goods are a normal good.
Gender was not significant in either regression equation.

Hypothesis
It was hypothesized that males would be more desired to purchase counterfeit good. There
are major studies that found no difference due to gender. The results for year in school
indicate a negative relationship with the purchase of counterfeit goods. Equity other
elements constant, older students were less likely to buy counterfeit goods compared to
freshmen students.

(Hegarty and Sims, 1978; Singhapakdi and Vitell, 1990) Gender was not significant in
either regression equation. It was hypothesized that Males would be more desired to
purchase counterfeit goods, based on previous studies, but this did not bear out. However,
there are several previous studies that found no Difference due to gender. The results for
year in school indicate a negative relationship with the purchase of counterfeit goods.
Holding other factors constant, older students were less likely to buy counterfeit goods
compared to freshmen students.

Discussion and implications

Consumers who had previously purchased counterfeit goods believed that attitudes more
supportive of counterfeiting than consumers who had not. In general, prior purchasers felt
that purchasing a counterfeit product is better as purchasing the real brand, and by
They were not hurting the US economy. The changes in attitudes can be necessary to avert
the demand for counterfeit goods. One method to influence attitudes could be through
The education of the consumer. Sometimes consumers do not feel they are committing a
crime by purchasing counterfeit goods, yet they do believe the sellers of these goods should
be punished. Messick and Brewer (1983), strategies to discourage counterfeit purchases
could be either structural or behavioral. The structural model could be used to reduce
counterfeit purchases by instilling fear of punishment. In return this would then be linked
to a change in behavior towards the purchase of counterfeit goods. The researchers suggest
that consumers must be convinced that benefits will accrue to a group with which the
consumer identifies with most. As most counterfeits in the USA are imported, anti-
counterfeiting appeals need to focus on the negative impact that buying fakes has on
American jobs, tax revenues, and balance of payments, as well as crime (Cordell et al.,
1996). Americans may not be aware that their contribution to purchasing counterfeit may
be used to fund organized
crime and illicit activities such as prostitution (Tom et al., 1998). the findings of this study
support previous research that shows consumers’ attitudes are an important factor
affecting the purchase (on choice not to purchase) counterfeit goods. One implication of
this finding is that a change in attitudes may be of greater importance in deterring the
demand for counterfeit goods than an increase in consumer awareness or education about
the problem. Future research could examine the impact of changing attitudes versus
greater education on
the demand for counterfeit goods. In addition, consumer education, or changing
consumer attitudes towards purchasing may not be sufficient to abate the growth of
counterfeit goods. Legal action against consumers may be necessary, but this is an area
for further study. One limitation of the study was the use of convenience sampling.
Although
attempts were made to select a sample that would contain a cross-section of students,
various sampling is suggested for future studies, to the extent possible.
References

Norum, P. S., & Cuno, A. (2011). Analysis of the demand for counterfeit goods. Journal of
Fashion Marketing and Management: An International Journal.

Staake, T., Thiesse, F., & Fleisch, E. (2009). The emergence of counterfeit trade: a
literature review. European Journal of Marketing.