"The problem is there's no copyright [ed: trademark] laws, so as soon as you put a good product on the street, people will copy your stamp," he said. "A good dealer will let his customers know and say, 'Hey, next week we're coming out with a different stamp on our bag. We only sell from this corner or this house, so only buy from me.' "We have a standard theory of how trademarks promote efficient markets, but I'm not sure there's much empirical work on the subject. Seems like drug markets might be a place to start, though the unavailability of any formal law at all is a confounding variable. We don't want efficient drug markets (just as we don't want efficient markets for child pornography); is there any way to tell how much absence of TM protection contributes to inefficiency?
Tuesday, June 13, 2006
Drug dealers and brand loyalty
The story's headline is Drug Dealers Pushing 'Brand Loyalty,' and it's about stamps used to distinguish varieties of individual-dose heroin. The content is actually about an IP-less economy, where no trademark laws apply and thus copying a popular drug "brand" is common. According to one police captain, dealers can't rely on branding:
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trademark
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