Ursula K. Le Guin’s poorly-argued and evidence-free rant against Amazon is more about her hatred of capitalism than about Amazon’s actual effect on the market for books. Here’s Le Guin:

[Amazon’s] ideal book is a safe commodity, a commercial product written to the specifications of the current market, that will hit the BS list, get to the top, and vanish. Sell it fast, sell it cheap, dump it, sell the next thing. No book has value in itself, only as it makes profit. Quick obsolescence, disposability — the creation of trash — is an essential element of the BS machine. Amazon exploits the cycle of instant satisfaction/endless dissatisfaction. Every book purchase made from Amazon is a vote for a culture without content and without contentment.

The same argument was made in the late 1990s against chain bookstores like Border’s. It wasn’t a good argument then (see Tyler’s masterpiece, In Praise of Commercial Culture) but at least at that time it was debatable. Le Guin’s attempt to resurrect the argument today is bizarre. Does anyone doubt that it is easier to buy a niche book today than it ever has been in the entire history of the world? Indeed, does anyone doubt that it is easier to buy a Ursula K. Le Guin book today than it ever has been in the entire history of the world?

Larger markets support greater variety. A bookstore that only sells locally can’t stock many books. It’s the smaller store that fears taking a risk because the opportunity cost of shelf space is so high. Amazon lowers the cost of stocking books through efficient logistics and by warehousing in relatively low-cost areas (subject to being close to markets). The fixed costs of distribution are then spread over a much larger (inter)-national market so it pays to stock many more books.

Amazon makes a lot of money selling niche books. The precise numbers are debatable because Amazon doesn’t release much data but Brynjolfsson, Hu and Smith estimated that the long-tail accounted for nearly 40% of Amazon sales in 2008, a number that had risen over time. Indeed, since costs aren’t that different it’s not obvious that Amazon makes much more from selling a million copies of a single book than from 10 copies of each of 100,000 books (especially if they are ebooks).

Ebooks take this argument to the limit and the data show greater diversity in who publishes books than ever before. According to a recent Author Earnings report:

…indie self-published authors and their ebooks were outearning all authors published by the Big Five publishers combined

Perhaps what pushes Le Guin onto the wrong track is that there are more (inter)-national blockbusters than ever before which gives some people the impression that variety is declining. It’s not a contradiction, however, that niche products can become more easily available even as there are more blockbusters–as Paul Krugman explained the two phenomena are part and parcel of the same logic of larger markets. It’s important, however, to keep one’s eye on the variety available to individuals. Variety has gone up for every person even as some measures of geographic variety have gone down.

In the past small sci-fi booksellers in out-of-the-way places (link to my youth) barely eked out a living from selling books. Precisely because they didn’t make a lot of money, however, the independents signaled their worthy devotion to the revered authors. Today, Amazon sells more Le Guin books than any independent ever did. But Bezos doesn’t revere Le Guin, he treats her books as a commodity. That may distress Le Guin but for readers, book capitalism is a wonder, books and books and books available on our devices within seconds, more books than we could ever read; a veritable fountain, no a firehose, no an Amazon of books.

Maybe that welfare cost is not very high at all.   After all, if Amazon does not carry a book you can sign up at the Barnes & Noble website and that takes a few minutes at most.

There is a tension in most criticisms of Amazon.  On one hand, the critic wishes to argue that a “not carry” decision by Amazon has a big impact on how a book does.  On the other hand, the critic wishes to argue that the loss of access to particular titles is a big deal.  You cannot easily have it both ways.  If readers won’t switch to B&N.com, they must not care very much about particular titles, in which case the Amazon refusal to carry (or delay in shipping) is small even relative to the size of the (small) trade in books.

Krugman’s column today, which covers Amazon vs. Hachette, appears terrible at first glance, but in fact he presents a new and original argument.  Get past the mood affiliation and you come to this:

…what Amazon possesses is the power to kill the buzz. It’s definitely possible, with some extra effort, to buy a book you’ve heard about even if Amazon doesn’t carry it — but if Amazon doesn’t carry that book, you’re much less likely to hear about it in the first place.

If I may fill in some blanks, one possible version of the hypothesis — to pull an idea from Gary Becker and Steve Erfle — is that readers consume both “books” and “buzz around books” as complements.  The marginal gains from books can be low but the marginal gains from the bundled package may be much higher and those higher gains will not be measured by the (high) price elasticity of book purchases.

In the early stages of this war, Amazon boycotts have often increased the buzz for a book, such as with Beth Macy’s Factory Man.  But if these practices continue, they will cease to be news stories and an Amazon refusal to carry or promote plausibly will damage how books will do, without much potential for upside.

How much of the value in a book/buzz package is due to the buzz?  65 percent?  That would explain the concentration of reading interest among bestsellers and books your peers are reading.  But if Amazon won’t carry or promote a book, does the total supply of buzz fall?  Or does the buzz simply transfer to other titles?  In the latter case we are again back to small welfare costs from an Amazon refusal to carry.  Krugman’s idea is fun, but I am still inclined to think the welfare cost of Amazon supply restrictions on individual books likely is small, again even relative to the size of the book sector, much less relative to gdp.

It is fine to argue that Amazon is being unfair to some authors and to object on ethical grounds.  The economist also should add that readers don’t seem to mind very much.  Most of the objections I am seeing are coming from authors and publishers, who of course in this sector are much less diversified in their interests than are readers.

Matt will be excited:

Popular online shopping site Amazon now provides free shipping to Singapore.

As long as shoppers in the country make a purchase of SGD$160 (USD$125) or over, they will be entitled to this free shipping under the site’s “Free AmazonGlobal Saver Shipping” program.

This new privilege, which also applies to consumers in India, was announced on the website on Friday.

The qualified amount to be spent by shoppers for the free shipping does not include import fees, gift-wrap charges, duties and taxes.

The free shipping is only provided to online shoppers purchasing goods sold directly by Amazon and not by their third party retailers.

The goods purchased must also be eligible for the AmazonGlobal program, which makes up a majority of the site’s product catalog, ranging from automotive products, electronics and jewelry to name a few.

However, shoppers need to make sure that the goods to be shipped do not exceed 20lbs. (9 kg) or they will not qualify for the free shipping service.

The link is here.