Book Review: The Knockoff Economy: How Imitation Sparks Innovation

I came across this book while browsing inside Strand Bookstore in Greenwich Village and after reading the first couple of pages, I was captivated and knew I had to read the entire book.   The premise of the book is that despite preconceived notions that intellectual property laws spur creativity and innovation by protecting those ideas and the originator of those ideas, the authors, Kal Raustiala and Christopher Sprigman propose instead innovation thrives and is greater when there is no intellectual property protection.

The authors go through specific examples and analysis in the world of fashion, food, comedy, football and finance.  My focus will be on fashion but the entire book should definitely be read.  The fashion chapter of the book starts with a short history of fashion and copying.  I found it interesting that back in the 1930's there used to be a Fashion Originators' Guild of America which almost operated as a cartel to limit copying by American designers.  The Guild was quite effective for almost a decade until the Federal Trade Commission shut them down declaring that the Guild was an illegal cartel and suppressed competition.  

As I've noted in my blog in the previous posts, U.S intellectual property law does not protect useful articles such as clothing.  There has been efforts made with the Innovative Design Protection and Piracy Prevent Act in 2009 and its predecessor, the Design Piracy Prohibition Act of 2006, which both has gone no where to date. The books discusses these two acts briefly as well.  

Then on to the juicy part - knockoffs.  The authors argue that knockoffs speed the fashion cycle which also fuels the creative process.  "This is the fashion cycle.  New design catch on, becomes trend, spread, become overexposed, and die. . . and the process repeats."  This keeps fashion companies on their toes to create the next new trend and stay ahead of the fashion curve, thereby sparking more innovation.  Further, the authors note designers, even high-end designers engage in the practice of imitating and are not afraid to admit it and it is a acceptable social norm (imitating that is, no true copying).  

I would have been interested in reading more about the economics of knockoffs which the book touches upon by mentioning that the fashion industry is thriving even though there replete legal imitation and demonstrating that the average prices of high-end dresses have increased in the last fifteen years compared to low-end dress prices which are stagnant.  However, it doesn't go into the volume of dresses sold or whether knockoffs affect the original creator commercially and financially.  Nonetheless, I understand the the book isn't focused on the economic impact of knockoffs but the innovative impact which is the primary purpose of IP laws.  

Overall, it was very informative and insightful, covering a range of industries.  I enjoy books that challenge conventional thought and makes the reader think.  Even though, I originally read the book for the fashion and IP analysis, I enjoyed reading all the chapters and how IP or lack thereof has effected those area.  Plus, although the authors are both lawyers, there is no need for a background on law to understand the arguments and analysis.  They write in layman's terms and the writing is clear and crisp so anyone can enjoy this book.  The authors draw from current events and everyday experience to provide very relevant and familiar examples to back up their theory.  It is very thorough and well-written - I highly recommend it.  

The book can purchased on Amazon.com.