Until it progresses beyond the current transitional economic and enforcement systems, it is virtually impossible for China to eliminate the production of pirated goods. But there is one arena in which change may be coming on the demand side, as demonstrated by consumer attitudes toward luxury brands.

Brand-name clothing and accessories, authentic or not, and preferably foreign, are incredibly popular with the Chinese. The expanding numbers of upwardly mobile, white-collar urbanites are more savvy about the prices and associations of upscale Western brands than most of their Western counterparts. Even farmers and migrant laborers can be spotted sporting the Nike swash, and you can bet your sneakers that they could never afford the genuine article.

For China's status-conscious nouveau riche, brands provide a fast track to prestige. They serve as an easily quantifiable marker of rank and wealth, establishing the wearer or bearer's position in the monetarily determined social pecking order. The absence of individualism in Chinese society also means heightened susceptibility to advertising's promises to provide the buyer with a certain prepackaged image and identity. Although China had its own brands almost a century ago, decades of Maoist drabness made brand names a novelty upon their reintroduction. Adding to that novelty is the glitz of the modern branding campaign, and an open-armed affection for things foreign that flies in the face of China's innate national parochialism.

"In China, the income disparities are so wide that any means of standing out at a glance is valuable," observes Godfrey Firth, a consultant with market research firm CBC. "Brands are an instant way to advertise one's financial ranking, which is increasingly required to find a job, get contracts or attract a potential spouse. Any way of distinguishing oneself as not a peasant is good. Moreover, people have yet to move beyond the Chinese tradition of ostentatious display of wealth, such as elaborate weddings and funerals. Showing off, the whole peacock thing, isn't seen as bad or tacky."

Buying authentic brand items carries more weight for those who can afford it. A typical example is a former Chinese colleague of mine who boasted about spending the equivalent of $40 on a pair of socks at Lane Crawford. However, copies provide an acceptable if less prestigious alternative for the vast majority of the population who cannot. Firth points out that "if people could afford it, they would buy real brand items; most just can't, but they still want to show off as if they could. When they get rich enough, they do buy real brand items and boast about it: 'Someone bought mine for me in Japan, and paid so much, but yours is fake.'"

Although definitive statistics are unavailable, imitations probably equal or outnumber originals for popular low-end brand clothing and accessories, such as casual wear or items featuring popular icons like Disney and Peanuts characters. A 2000 South China Morning Post article cited Nike as estimating its piracy rate at 50 percent, although the company now claims a more optimistic 15 to 20 percent.

High-end brand products are less pirated, as their higher quality makes them harder to convincingly replicate. Benjamin Simar, assistant operations manager with risk management firm Hill and Associates, points out that Chinese buyers of luxury brand goods are increasingly "sophisticated consumers" who view the purchase as an investment in a certain image and are unwilling to buy copies. Luxury goods are also one of the categories subject to intensified government scrutiny and to aggressive action by the companies whose trademarks are violated.

As China develops, its consumers may grow less willing to purchase pirated clothing, cosmetics, food and cigarettes, and perhaps with time that desire to distinguish themselves will evolve into a fan loyalty sufficient to cause them to reject pirated music, films and software. But a world of difference separates the English-speaking Shanghai slickster willing to pay thousands for a Hugo Boss suit and the illiterate, unemployed Hunan peasant who makes only hundreds a year copying Hugo Boss suits.

Yes, improved legislation and heightened government commitment are steps in the right direction. Corporate piracy is heading toward extinction, as listed Chinese companies that have offices overseas and high volumes of exports are susceptible to international lawsuits, and software piracy is declining. However, the Communist Party has proven itself unable to address the desperation of the economically disenfranchised, who will continue to gravitate toward piracy until the legitimate economy can provide a better option.

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