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Books to remain expensive

My guess that the Government would buckle under local interest group pressure to reject the parallel import of books has proven correct. Mark at LP is pleased to learn that the moves to allow free trade in books suggested by the Productivity Commission have been stopped by the Rudd Government. In fact he asks why have a Productivity Commission at all?  It is difficult to argue with this level of prejudiced ignorance – particularly as it was backed by that much-lauded ANU-trained economic guru Craig Emerson.  I make two comments:

1. That part of the reason for retaining the law on parallel importing was that local book providers already face competition from imported books.  If this is the case there must indeed be significant cost savings in buying books in global markets rather than purchasing them locally.  This runs counter to claims that the price savings in allowing parallel imports are low. If they were low local publishers would have little to fear anyway.

2. If Australia seeks to support local authors – I don’t reject this –  then give them a subsidy not penalise all consumers with higher prices.  Local authors don’t like this because their dependence on goverrnment handouts becomes explicit but such subsidies are less restrictive than partial prohibitive tariffs on trade and provide comprehensive protection for Australian authors even in the face of online purchases. 

It is just so important for people to learn some basic economics.  Governments can get away with this interest group-driven stupidity that inflicts net costs on society as a whole only because not enough people understand some basic logic about markets.

Update: Useful comments by Joshua Gans and a critique by Sinclair Davidson.

12 comments to Books to remain expensive

  • conrad

    The really strange thing about this is that it simply ignores reality, since if you want a book, you can generally get it from ebay anywhere in the world, usually for far cheaper than a bookstore like Readings (even better if it’s second-hand). These sorts of laws stopping importing are for people that still think the world operates like 1992. Even if they would have been good then, they’re pointless now.

  • Uncle Milton

    On this occasion, Harry, the politics have trumped the economics. It happens with all governments. The literary set who wanted to keep the restrictions are an important Labor constituency. Bizarrely, the restrictions are not even generally in their interest, but they have a reflexive opposition to free markets. It might be pointed out to them that the economics of allowing parallel imports of books are the same economics that propose to put a price on carbon, which they support, but that would be a waste of time.

    Unfortunately the case for removal was led by Bob Carr, who nobody likes, with good reason. And the language in the Productivity Commission, with its talk of “cultural exteranlities”, was just awful. This is a case study in how a good cause was butchered by poor presentation.

    And in fairness to Emerson, he did look look uncomfortable defending the decision.

    You can take some comfort in the fact that the Aussie dollar so strong, buying from Amazon is now dirt cheap.

  • Harry – I’ve joined the fray over at LP.

    “Local authors don’t like this because their dependence on goverrnment handouts becomes explicit ”

    I don’t agree – I think (actually I know) the authors are just dopey about how business works and they have been intimidated and brainwashed by their publishers.

    and Uncle Milton -if you are buying from Amazon you are being ripped off – kor look up booko to compare prices.

  • hc

    FXH, I spent a few minutes checking out ‘bookdepository’ in my field of economics. They have a good range of books – including reprints of out-of-prints and the claimed free postage would help. On the recent Freakonomics they quoted $20-77US compared to Amazon’s $16-47US which would be about the same given Amazon’s postage charges. I spend a lot at Amazon so I’ll keep this in mind but I like Amazon. Very good service and now a vast range now available for kindle.

  • derrida derider

    As you wish, Harry, but I find BookDepository mostly a bit cheaper than Amazon once you factor in shipping. And their service is first-rate. If you’re happy with secondhand or if the book is out of print then you really can’t go past Abebooks – especially as its network does include a lot of Australian secondhand bookshops.

    I buy lots of books but I very rarely buy at bookshops – it’s just too expensive and you’re limited by what they’re choosing to promote and stock. FXH is dead right about the authors though – they’re quite clueless as to their own interests. And Uncle Milton is right about Emerson – you can see he got rolled in Cabinet and now has to publicly grin and bear it while eating the shit sandwich in public, just as we are used to seeing Garrett do.

  • fxh

    harry – book depository is extremely reliable – in most cases books arrive on my doorstep within 7 days.

    It is free postage. And they send books as available so you don’t have to put a package together. So often I can get a book delivered each day ..

    They leave it on doorstep or post box so you don’t have to go to Post Office if you are not home.

    The good thing is that they also show you the Amazon price on the Book Depository page so you can compare.

    I’ve been told by others that Amazon UK is cheaper to buy from + postage than amazon USA.

  • fxh

    Superfreakonomics: A Tale of Altruism, Terrorism and Poorly Paid Prostitution
    Steven D. Levitt EAN: 978-0713999907 Format: Hardcover Publisher: Allen Lane
    Published: October 2009

    In au$ – all plus postage

    Book Depository UK $25.78
    Amazon UK $32.24

    Readings $66.45
    Collins Booksellers$66.90

  • fxh

    all prices INCLUDE postage

  • fxh

    If you click through – its misleading because even though they are dearer Readings and Collins don’t have it in stock – and Collins adds this helpful reminder to order direct from overseas:

    “This title is ordered from an overseas publisher and may take up to 45 days to ship. It is also subject to publisher availability. Allow a few extra days for delivery.”

  • hc

    FXH, I’ll certainly give it a go though, as I say, I have a lot of time for Amazon. Whenever anything has gone wrong they refund or replace.

    What a disaster though for Australian book consumers that we have to buy from overseas!

  • I’m sad for my local bookshop and Australian (ignorant) authors.

    And yes I’ve had a good experience with amazon when I sent about $200 worth of books to my daughter in Taiwan.

    They never arrived – I suspect because they were knocked off somewhere in Taiwan but Amazon refunded me the lot – no hassle – I naturally re-ordered all of them and they arrived – so I’m assuming they think I’m honest for next

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