Table Of ContentRevolutions in Book Publishing
DOI: 10.1057/9781137576217.0001
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DOI: 10.1057/9781137576217.0001
Revolutions in Book
Publishing: The Effects
of Digital Innovation
on the Industry
Lall Ramrattan
Instructor, University of California, USA
and
Michael Szenberg
Distinguished Professor of Economics and Chair of
Business and Economics, Touro College and
University System, USA
DOI: 10.1057/9781137576217.0001
revolutions in book publishing
Copyright © Lall Ramrattan and Michael Szenberg, 2016.
Foreword © Benjamin M. Friedman, 2016
Softcover reprint of the hardcover 1st edition 2016 978-1-137-57620-0
All rights reserved.
First published in 2016 by
PALGRAVE MACMILLAN®
in the United States—a division of St. Martin’s Press LLC,
175 Fifth Avenue, New York, NY 10010.
Where this book is distributed in the UK, Europe and the rest of the world,
this is by Palgrave Macmillan, a division of Macmillan Publishers Limited,
registered in England, company number 785998, of Houndmills,
Basingstoke, Hampshire RG21 6XS.
Palgrave Macmillan is the global academic imprint of the above companies
and has companies and representatives throughout the world.
Palgrave® and Macmillan® are registered trademarks in the United States,
the United Kingdom, Europe and other countries.
ISBN: 978-1-137-57621-7 PDF
ISBN: 978-1-349-88753-8
Library of Congress Cataloging-in-Publication Data is available from the
Library of Congress.
A catalogue record of the book is available from the British Library.
First edition: 2016
www.palgrave.com/pivot
DOI: 10.1007/978-1-137-57621-7
To my late mother and father-in-law, Sundermonie and
Munisamy Munian from Bath Settlement, West Coast
Berbice, Guyana. I thank them for their love, enthusias-
tic encouragement and generous support in words and
deeds in my search for knowledge. I wish their souls
eternal peace and happiness.
–L.R.
B”H
Dedicated to the memory of my sister, Esther, for bring-
ing me to these shores; to the memory of my parents,
Henoch for his wisdom and my mother, Sara, for
giving birth to me—twice; to my wife Miriam and my
children Naomi and Avi, their spouses Marc and Tova;
to my grandchildren, Elki and Chaim, Batya, Chanoch,
Devorah and Nachum, Ephraim, Ayala, Jacob, and to
my great-grandchildren, Chanoch and Fegila. And to
the righteous German officer who took my immediate
family to a hiding place just days before the last trans-
port to Auschwitz, where most of my family perished.
–M.S.
DOI: 10.1057/9781137576217.0001
Contents
List of Figures vii
List of Tables viii
Foreword x
Benjamin M. Friedman
Preface and Acknowledgments xiv
1 General Introduction 1
2 Overview of Price and Nonprice
Competition 18
3 Consumption Aspects: Empirical Findings 50
4 Production Aspects: Employment,
Manpower, and Productivity 72
5 Distribution Aspects of the Industry 94
6 Printing and Publishing 108
7 Internet Technological Aspects of
the Industry 120
Conclusions 131
References 134
Index 146
vi DOI: 10.1057/9781137576217.0001
List of Figures
1.1 Amazon versus Naics 511 R&D, 1998–2007 ($m) 16
2.1 Price and nonprice decisions 19
2.2 Supply and demand for books 32
2.3 Product versus spatial differentiation of the
e-book market 37
2.4 Dynamic view of the book industry 39
2.5 The Chain Store Paradox 42
3.1 Book category share, 1985–2002 55
7.1 Outline of issues in Internet technology 123
7.2 Book industry value chain: business to consumer 127
DOI: 10.1057/9781137576217.0002 vii
List of Tables
1.1 Industry classification 7
1.2 Long-term growth, 1929–1963 7
1.3 Rivalry data (firms’ annual reports) 13
1.4 Advertising rivalry results: one firm’s generic
reaction to the advertising outlay of its rivals 14
1.5 Sales and losses for borders, 1996–2009 15
1.6 Franchise rivalry results: one firm’s generic
reaction to the advertising outlay of its rivals 15
1.7 Companies’ financials 17
2.1 Internet revenue and cost data 25
3.1 Long-term trends in the book publishing
industry 52
3.2 Translog regression: nonseparable results,
1985–2002 57
3.3 Own elasticity by book categories estimated
from regression results 59
3.4 Own elasticity and Lerner power index based
on regression results 59
3A.1 US book stores (NAICS 451211) sales,
2000–current ($m) 62
3A.2 Time series data for the book publishing
industry 63
3A.3 Historic trade trend data 1992–2006 ($ths.),
paper and publishing products 64
3A.4 Hardback, paperback, and mass media prices 65
3A.5 Regression analysis of growth trends 66
3A.6 Book by book categories, 1985–2002 ($m) 71
3A.7 Revenues of book categories, 1985–2002: $m
from Greco book 71
viii DOI: 10.1057/9781137576217.0003
List of Tables ix
4.1 Productivity explained by wages, 1989–2007 BLS data 74
4.2 Industry total scale economy, 2004–2006 77
4.3 Production function book publishing industry sample,
1998–2007 78
4.4 Translog approximation of CES production function,
BISG quantity, and compustat capital data 81
4A.1 Unemployment rate, nonagricultural private wage, and
salary workers, publishing, except Internet: 2000–current 83
4A.2 Book publishers: NAICS 51113, average hourly earnings of
production workers 83
4A.3 Industry technical data 84
4A.4 NAICS 511130, book publishers. Annual percentage
change of industry productivity data, 1988–current 85
4A.5 Productivity, costs, and output indices, 1987–current 86
4A.6 Regression results for productivity on wages 86
4A.7 (Additional data) Regression results for productivity on
wages 89
4A.8 Results use for translog/CES model of table T2-4 system 91
4A.9 GAMS model for the extraction of substitution parameters 92
5.1 Distribution aspects of book publishing 98
5.2 HHI calculation 98
5.3 Sales on concentration, SUR system estimates, 1963–2007
(available concentration data) 100
5.4 Size distribution of establishments, census data: 1992,
1997, 2002 102
5.5 Distribution of general, specialty, and college books,
number of establishments by employees: 1997 versus 2002 103
5.6 Sales–employees distribution 104
6.1 Triad VAT and GST tax rates in percent 111
6.2 Historic rate trends ($ths dollars) in the PPI 112
6.3 CGE benefits due to improved allocation and policy mixes 114
6.4 PPI for major countries in the Triad regions 116
6.5 TAA certification and denial 118
6.6 Global computer market information and communication
technology (ICT) spending 119
7.1 Five firms’ share of toll revenues 125
DOI: 10.1057/9781137576217.0003
