Counterfeit Supply Chains

Abstract

This paper studies supply chains of counterfeits in Turkey based on insider information from actors in such chains as well as from knowledgeable witnesses. The study depends on semi-structured interviews with actors in or witnesses to such chains. Findings suggest that (i) various forms of counterfeit supply chains exist, (ii) profit margins of counterfeiters seem to be higher than legitimate businesses, (iii) counterfeiters are discouraged if they experience actual or threatened litigation, (iv) law enforcement places higher priority on fighting counterfeits that threaten public health and safety, and (v) counterfeits appear to drive down the prices of legitimate products. Overall, poor action by legitimate businesses against counterfeiters, weak institutional efforts on the part of law enforcement and low consumer awareness appear to foster counterfeit supply chains, or at least contribute to their persistence.

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