The star of the new London play by scientist Carl Djerassi is almost as old as art itself. It is art�s antithesis, the fake. Phallacy is based on the true story of �Youth from Mt Magdalene�, a valuable Roman bronze of a lifesize nude man. For many years, the �Youth� was the centrepiece of the classical collection in Vienna�s Kunsthistorisches museum. But in 1986 it was revealed to be a 16th-century copy. And yet it remained a beautiful artwork, one that had deceived experts since entering the collection in 1806.

So just what is wrong with a fake? Certainly not enough to stop forgery becoming a multi-million dollar business. Across Europe, America and Asia, anywhere from 15 per cent to a staggering 80 per cent (in Africa and China) of artworks offered for sale are thought to be fakes. Cases such as the gang of French and Belgian forgers jailed in 2001 for reproducing Cesar�s �compression� sculptures make headlines. And the Impressionist forgers John Myatt or Elmyr de Hory became so well known that their works are sought after because of the forger rather than the forged.

The stakes are so high that academics researching provenance and authenticity of works by artists such as Modigliani have received death threats when a work�s authenticity is called into question, and catalogue authors have been offered bribes from collectors to keep particular paintings or sculptures in their publications. When a real Modigliani painting sells for more than $14m, perhaps this isn�t surprising.

The repercussions of forgery are manifold. Most obviously, the value of a work is drastically affected. Often it is an object�s place in history that determines, in large part, its price. In 1983, the J. Paul Getty Museum in Malibu bought a statue of a youth from the Greek Archaic period for a reported $8m. It is now thought to be from the same hand as a known modern fake, and is practically worthless.

Ninety years earlier, another famous museological gaffe occurred in Paris, when the Louvre acquired the 3rd-century BC �Tiara of Saitapharnes� for 200,000 gold francs. It turned out to have been made in 1880 by Israel Rouchomovsky, the Russian goldsmith, and was stripped of much of its value.

Perhaps the clearest case of historical loss of value is the Shroud of Turin; believed for centuries to have been the shroud of Christ, in 1988 it was found to be a medieval forgery. Radiocarbon dating placed it around 1260-1390, although attempts to discredit this finding continue.

In all of these cases, one thing did not change when they were exposed as fakes - the work�s physical appearance. But our perception of beauty is necessarily affected by the knowledge that the piece is no longer the �real thing�. The artists did not supervise the casting, make adjustments to the figure once cast, or choose the patina. They did not decide upon the pigments and grind them, select the subject matter or apply a certain glaze. Neither did they conceive of the idea for the work. This is the crucial difference between the fake - worth the cost of its materials, if that - and the original, potentially worth millions. Our relationship with the artist - our proximity to their impetus, their creative impulse -is lacking in any fake.

Forgeries destroy our understanding of the unique cultural climate from which a work arises, and so the power of art to transform that climate is eroded -only the original paintings of Caravaggio could lead to Mannerism�s demise; only Picasso�s 1907 proto-Cubist �Les Demoiselles d�Avignon� had the power to become the cornerstone of modern art.

Walter Benjamin described the power of the original artwork as its �aura�. In his seminal essay �The Work of Art in the Age of Mechanical Reproduction� (1936), he writes: �Even the most perfect reproduction of a work of art is lacking in one element: its presence in time and space, its unique existence at the place where it happens to be.� The �aura� is the reason millions cluster around the dark and mysterious �Mona Lisa� at the Louvre each year rather than looking at da Vinci�s most famous painting in books or online.

In our world of unstoppable mass-production, the essential power of an artwork - something a forgery can never possess - is its uniqueness. There are artists who have enjoyed upsetting this applecart of originality and exploring what Benjamin�s so-called �aura� really means. These include Marcel Duchamp presenting a mass-produced urinal as a signed artwork called �Fountain� in 1917, and Jake and Dinos Chapman, who replaced one �aura� for another when they recently bought �Disasters of War�, a suite of prints by Goya, for ?25,000, painted monstrous cartoon masks on each figure and proceeded to resell the suite for ?150,000.

Andy Warhol built his career on exploring the boundaries between the historical exclusivity of the artwork and the mass-reproduction of popular culture. He screenprinted his canvases, a production method devoid of the artist�s touch, and used newspaper photographs as subject matter. Not surprisingly his work has been frequently forged. The forgeries began in his own lifetime, most notably by his friend, the poet Gerard Malanga, who created works �by� Warhol based on the artist�s Pop Art poster �Che Guevara�. Ten years later Warhol noted in his diary the real problem with such forgeries: �They made my prices go down because people are now afraid to buy paintings because they feel they could be buying fakes.�

Dealers and collectors would often contact Warhol to have him authenticate his own work, but how do you spot a fake if the artist is complicit - Warhol actually went on to claim the �Che Guevara� pictures were his - or dead?

In the first instance, it has to be conceivable that the work is a fake. Take the Cottingley fairy pictures of 1917. These amateur photographs with painted fairies taken by children convinced even Arthur Conan Doyle, creator of Sherlock Holmes, and were not disproved until 1983, when the girls involved finally confessed. Though they are obviously fakes to our knowing eyes, such was the desire at the time to capture the supernatural that people believed what they wanted to believe. Likewise the Piltdown Man, an attempt to fake the missing link between man and apes. The �remains� were found in England in 1912; their authenticity was not questioned until after the second world war.

When there is suspicion that an artwork has been faked, scientific advances such as x-radiography, radiocarbon dating, drochronology (tree ring dating) and thermoluminescence (a method of dating pottery), have revealed inconsistencies in dates and production methods. In 1930, an early Botticelli, �Madonna of the Veil�, was bought for $25,000 and authenticated by Roger Fry, a respected art historian. But a young Kenneth Clark disagreed, pointing out that the allegedly Renaissance Madonna looked suspiciously like the film stars of the 1920s. On his hunch, scientific research revealed that the woodworm holes in the panel had been drilled in, and that the Madonna�s robe was painted with Prussian blue, which was not used until the 18th century.

There is a risk of over-zealous investigation of forgeries, however. In 1968 the Rembrandt Research Project was set up in Holland to investigate the growing number of works that were alleged to be by Rembrandt. From an initial tally of 630 paintings thought to be genuine, the figure now stands at less than 300. But many of the works now dismissed as copies probably came from Rembrandt�s studio, were painted by assistants in his style under Rembrandt�s watchful eye, and signed as if by him, with his approval. This was standard practice. While works produced in this way may not be as mesmerising or technically well painted as those done primarily by the artist, should they be expelled from under the umbrella of Rembrandt�s authentic work?

Artists continue to operate studios in a similar way - Antony Gormley encourages his dozen assistants to let their personalities shine through as they weld and forge his sculptures for him; Damien Hirst employs others to complete his spot paintings, even allowing them to choose the colour of the dots. If we accept the argument for Rembrandt�s studio works, should we then also exclude works from Gormley�s or Hirst�s oeuvre? Of course not. The concept of each work, whether by Rembrandt, Gormley or Hirst, is theirs - it is the execution, not the idea, that has been delegated.

The sculptor Henry Moore also employed an army of assistants (including artists Anthony Caro and Richard Wentworth) to scale his hand-sized models up to the six-metre stone and bronze sculptures that occupy public plazas around the world. One such sculpture was �Arch� (1980), in Kensington Gardens in London. Built out of travertine, it was dismantled after 16 years when it became unsafe as a result of the stone twisting in the damp climate.

Last month Carlo Bilotti, a billionaire art collector, offered to pay to have another �Arch� made in a marble suitable for the British weather. The copy would then be placed in Kensington Gardens, and the restored original would be given to his home town of Cosenza, in Italy. But will the copy be a valid replacement? No. Restoring the original and reinserting it into the park is to be applauded, but Bilotti�s idea leaves the park with a mere copy, while the original - worth hundreds of thousands of pounds - leaves the country.

In Djerassi�s play Phallacy, the �Youth� turned out to be a Renaissance copy of a Roman original that had disappeared. While the copy immediately lost 1,400 years of history and its �aura� as an original artwork, it became one of the earliest known Renaissance casts of a large-scale antique bronze. It has its own place in history, created almost 500 years ago at a time when the market for Roman sculptures was such that Michelangelo, who at that time was at the height of his powers as a sculptor, felt the need to do a little faking of his own. As Dr Regina Leitner-Opfermann, the (fictional) director of antiquities in Phallacy, (factually) recounts: �Michelangelo once made a superb, life-sized Cupid and then had it buried in a garden in Rome. When they dug it up, it was bought by Cardinal San Giorgio as a Roman antique at a super-inflated price.� She adds later, �He [Michelangelo] even did it a second time with the head of a Satyr, breaking off one of his teeth to make it look older.

�But,� she concludes, �his object was money, not fame.� As with the creation of all fakes, it all comes back to money in the end.