At present, a common phenomenon in the development of China's market economy is the prevalence of counterfeit and shoddy goods in the market, involving food, clothing, household appliances, fertilizers and pesticides, seeds, cosmetics, medicine and other industries. The existence of a large number of counterfeit and shoddy goods has become a major public hazard in the development of China's market economy. All goods that are produced or sold under false pretenses of authenticity, poor quality, good quality, low grade and high grade, and stealing other people's names or brands belong to fake and shoddy goods. For the convenience of analysis, we call fake and shoddy goods "fake goods" and non-fake and shoddy goods "real goods". The reason for the existence of fake and shoddy goods is that the subject of market economy, as a "rational economic man", pursues the maximization of its own interests. If the production or sale of genuine products can benefit the most, fake products will not be produced or sold. From the perspective of economics, the main bodies in the market economy are producers, consumers and the government.

first of all, from the producer's point of view, in order to pursue the maximization of benefits, that is, to make the cost as low as possible or the selling price as high as possible, the producer may take two actions: first, to cut corners as much as possible in the production process, shoddy goods, and produce fake goods at a lower cost than the real ones. Because of the asymmetric information between producers and consumers, the fake goods produced are not easy to be discovered by consumers, and they can pretend to be real goods for sale in the market. For example, in order to save costs, pharmaceutical manufacturers can reduce production costs by replacing genuine raw materials with low-priced inferior fake raw materials. Without professional knowledge, ordinary consumers can't find the real information in their production process, or the cost of finding the real information is very high, and they can only know it through tests and other means, so that the fake products produced in this way can be sold in the market at the price of genuine products, thus gaining more benefits. On the contrary, some goods that are easy to be grasped by consumers are not easy to become fake goods, such as chopsticks and sewing needles, because if such goods are fake, they are easy to be found by consumers, so they cannot be sold as genuine goods in the market. Second, even if producers don't cut corners and use normal raw materials to produce products, in order to obtain high profits, they can also use brand-name goods for sales, because the price of brand-name goods is higher than that of ordinary goods. For example, a manufacturer of liquor uses normal raw materials for production in the production process, and in order to obtain higher profits, it produces and sells in the name of brand-name liquor with great influence and higher price in the market, saying, "As long as it can compete,

secondly, from the consumer's point of view, there are three reasons for the existence of counterfeit goods: first, consumers are deceived by producers and passively buy counterfeit goods because of their lack of knowledge about commodities. Any consumer's knowledge is limited, and there are a lot of goods on the market. In addition, in the production process, producers always try their best to cover up the real information in the production process, which makes it more difficult for consumers to identify counterfeit goods. For example, a consumer with rich knowledge of cosmetics may easily identify counterfeit cosmetics, but if he has very little knowledge of liquor, he may buy fake liquor. Second, consumers, as rational economic men, take the initiative to buy fake products for the maximization of their own interests, which is also an important reason why fake products can exist in the market. For example, a set of genuine brand-name clothing is expensive in the market. If a manufacturer produces fake clothing similar to this set of genuine brand-name clothing in style, function, appearance and other aspects, but the price is low, even if the manufacturer clearly tells consumers that it is fake when buying, it may also prompt consumers to buy it. The same reason can explain why there are a large number of pirated software and pirated CDs in the software market and audio-visual market. Third, the cost for consumers to deal with fake goods disputes is too high. After consumers passively buy fake goods, they later find that if there are too many obstacles in the process of dealing with fake goods disputes and the cost of dealing with fake goods is too high, as a rational consumer, they have to admit that they are unlucky, making the fake goods even more unscrupulous.