walkitout (walkitout) wrote,
walkitout
walkitout

On Monopsony

http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2399575

Paper by John B. Kirkwood, Seattle University School of Law (hey, I attended someone's law school graduation there about a decade-ish ago). It's about the antitrust action against Apple in conjunction with the agency pricing price fix conspiracy. It's pretty good, and the last section presents an interesting set of criteria for when sellers might be justified (that is, procompetitive) in colluding against a monopsony. Too long, don't want to read? Surprise! The publishers didn't meet any of the criteria. And they would have had to meet all.

This isn't a decision -- it's an academic paper. So you know, just one man's opinion and he's not a judge so it doesn't set a precedent.

Along these lines, one of the indicators that a monopsony is being anticompetitive is if suppliers (publishers/writers in this case) decide to quit supplying because the price they are being paid is too low. With that in mind, contemplate this, from Hugh Howey (h/t PassiveVoice):

http://authorearnings.com/the-tenured-vs-debut-author-report/

"It’s easy to see that, for the past 4 years, and even taking lost print sales into consideration, far more Indie authors than Big-5 authors are earning a living wage from their writing."

Kirkwood argued for other reasons that Amazon _is_ exercising power in its relationship with publisher-suppliers -- but that power is countervailing at most. Howey presents evidence (which has real limits) that when Amazon created a new market for selling books to customers, it enabled a group of authors to make a living wage who were marginal in the pre-existing world of trad pub, and still more authors who never made it into that world at all to make some money, sometimes a living wage or better. This is not a monopsony pushing _authors_ too far out on the curve (altho it might be a monopsony pushing editors/publishers out of business).
Tags: our future economy today
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