In The Piracy Paradox, Kal and I have been careful, as Wendy and James both note, to avoid much normative content. We offer some models to explain why fashion has long operated, and thrived, under a low-IP rule. But we don't say much -- indeed, we don't say anything -- about whether what's good for the fashion industry is good for society.
Let me at least tiptoe into the normative minefield, using Wendy's and James's observations as a jumping-off point. Wendy is concerned that social welfare suffers when firms spend money to maintain fashion industry marks, such as Rolex or Prada, that serve mainly to confer status rather than indicate source. I read Wendy to favor a relaxation of dilution rules as they would apply to fashion industry marks. James extends Wendy's status consumption questions to fashion in general -- if the piracy paradox does nothing but facilitate an endless status race to nowhere, what have we gained from the low-IP equilibrium? Nothing but grief.
Alright, here are my tentative views:
(1) The key, I think, to unlocking the questions posed by Wendy and James is whether humans manifest a "lump" of status competition, or whether our propensity to compete for status varies depending on legal rules and social practices. If status competition (via clothing or something else) is hard-wired into our brains, legal rules discouraging fashion status races -- whether relaxed trademark dilution rules or firmed-up copyright doctrine -- is spitting into the wind. If, on the other hand, status consumption of apparel would respond to rule changes, then we should at least approach the question whether we're going to sacrifice the autonomy interests of consumers to our common interest in avoiding an avoidable (and socially wasteful) status race.
(2) Call me a misanthrope, but my own working hypothesis is that humans are status-hungry, and that this hunger is a basic part of our biological heritage. I don't want to wade too deep into evolutionary biology, but sometimes when I think of status competition via apparel I remember the Magpie Shrike that nested near my house when I lived in Johannesburg. This bird's flight, and therefore its hunting success, is weakened by its enormous tailfeathers. I'm not sure whether, in this particular bird's case, the elongated tailfeathers are an element of the male's courtship success. If they are, the male bird is engaged in a costly status competition that itself is an element of a broader competition to spread genes. So too human males and their Armani suits.
(3) If humans are incorrigable status competitors, then regulating one status race is likely to shift status-racing demand to another forum. Big houses. Fancy cars. More opulent churches. Too much post-graduate education. None of this sounds any better to me than positional consumption of fashion.