Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/55348
Authors: 
Hackett, Petal Jean
Year of Publication: 
2012
Series/Report no.: 
CESifo working paper: Industrial Organisation 3716
Abstract: 
Continued lobbying by high-end, American designers for intellectual property-type fashion design protection has culminated in the proposed Innovative Design Protection and Piracy Prevention Act, intended to introduce EU standards. Using a sequential, 2-firm, vertical differentiation framework, we analyze the effects of protection on investment in innovative designs by high-quality (designer) and lower-quality (mass-market) firms when the mass-marketer may opt to imitate, consumers prefer trendsetting designs and firms compete in prices. We show that design protection, by transforming mass-marketers from imitators to innovators, may reduce both designer profits and welfare. The model provides possible explanations for the dearth of EU case law and the increase in designer/mass-marketer collaborations.
Subjects: 
intellectual property rights
fashion design protection
imitation
licensing
JEL: 
D21
L13
O31
O34
Document Type: 
Working Paper

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