The Threat to Intellectual Property Rights Posed by Counterfeits

If we are to allow counterfeiting and piracy to run unabated, the risks to the American economy are obviously very serious. However, if we are to invest in protecting our nation’s consumers, workers and businesses from IP thieves, the rewards will come back to us six-fold. According to a report commissioned by the Coalition Against Counterfeiting and Piracy (CACP) – which the NAM helped found – investing in stopping counterfeiting is sound economic policy. Authored by Laura Tyson, former Chair of the National Economic Counsel, the report entitled “An Economic Analysis of the Proposed CACP Anti-Counterfeiting and Piracy Initiative” concluded that:

  • For every dollar invested, federal tax revenues would increase significantly with an intermediate range of $4.9 to $5.7;
  • Each dollar would increase U.S. economic output approximately between $64 and $75;
  • The increase in output would result in the creation of between 174,000 and 348,000 new jobs during the third year of the program; and
  • State and local governments can expect to receive incremental revenues between $1.25 billion and $1.50 billion, in present value terms over three years.

The Report also concludes that by aggressively going after counterfeiters and pirates as laid out by the PRO-IP Act and recommendations included in S. 1631, Congress’ efforts could reasonably be expected to reduce losses attributable to piracy and counterfeiting somewhere between five and ten percent over three years.

S. 1631 is Customs Facilitation and Trade Enforcement Reauthorization Act.


Leave a Reply