Economics from a naïve non-economist

If you spend time in the world of social media, you may already know about the University of California vs. Elsevier Publishers on the economics of publishing scientific journal papers. See: https://www.theatlantic.com/science/archive/2019/03/uc-elsevier-publisher/583909/ and the background information in https://www.theguardian.com/science/2017/jun/27/profitable-business-scientific-publishing-bad-for-science for a sample discussion. Now I know nothing in particular about economics but I can perhaps add a footnote to this discussion from the point of view of having published ecology textbooks and investigated their cost.

Perhaps 20 years ago I had a good conversation with an honest person in the know of a book company I have sometimes published with, regarding the costs of publishing textbooks. At that point in the Stone Age, biology texts were about $100 or slightly less, and often some publishers would put out a paperback version of the same text at a much cheaper price, perhaps $35 or $40 for sale outside of North America. I thought that perhaps they ought to allow students in North America to buy the cheaper paper version, so I enquired about costs. The bottom line is that it cost perhaps $0.25 more for publishing a copy of the hardback versus the cheaper soft paperback version. The quality of the paper was no different in the two versions, and thus the costs of production were very close while the prices to the buyer were greatly different. This could be explained by putting all the heavy costs on the hardback copy because it takes a lot of editing and printing to set up the book for a printing run. So, one could argue that the cost difference should not rest on the costs of the paper alone. This led into an interesting conversation that is now only a memory for me since the CIA did not yet at that time record all phone calls of suspicious academics like ecologists. I was told that the publisher who must remain nameless wished to achieve a profit of 35-40% per year of costs for any book. Not all books sell well, and after a few years sales drop off and the whole process begins again. But my naïve question was where can I invest my savings to get a return of even 25% per year? At the present time I can perhaps get 1% per year in the bank. The author of your textbook gets perhaps 2% to 3% of the money you pay for your text, so I do not think this problem rests with the author’s excess profits.

I found it insane that anyone could simply assume that such profits are reasonable in a world that is sustainable. Yet I think now that this is a typical economic viewpoint that underlies the problems of inequality in our world, and the general rule that the rich get richer and the poor get little. So Elsevier publishes research papers that rest in large part on research work paid for by the government, with the researchers being paid for by universities or public agencies, and virtually all the preparation of the published results being done by the researchers, and then as the final blow the publisher wishes to charge the research worker (or their university) for the actual published article. So, for the moment the University of California has set a halt to this profit charade. I am sure we will soon see a set of tearful articles from publishers that they are themselves in the poorhouse and do not make enough profit as, for example, comparable corporations such as Shell Oil or Facebook. So be it.

A cheer for those scientific journals that do not ride this profit bandwagon, and the editors that are not paid for all their work, and the scientists who review submitted papers to improve them and are paid nothing for their extra effort. Perhaps someday we can be finished with the modern economic theory that seems to treat the world as a large Ponzi Scheme, and return to a saner sustainable economic world.

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