Chinese Piracy Politics 101

No problem of this size and scope could exist without the direct or indirect involvement of the state.

—Professor Daniel C. K. Chow, Ohio State University

All of our observations thus far about the favorable economics of Chinese counterfeiting and piracy still do not explain why, despite an occasional highly publicized crackdown, the Chinese government tacitly supports these illegal activities. The reason goes back to both basic economics and politics—with a particular Chinese cultural twist.

With counterfeiting and pirate activities contributing as much as 20% or more of China’s economic growth, state-sanctioned piracy and counterfeiting is a vital component of government policy. This intellectual property theft ...

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