An economic model of paid sex: Coase’s “The Nature of the Firm,” gains from trade, and the gift economy

In Roosh’s “Orgasm or Money” story, he describes encountering yet another semi-pro prostitute in Latvia,* and he ends by wondering about sexual cultures around the world:

Then I thought about what she had said, how it was stupid for American girls not to ask for money before sex. Was it possible that the sexual culture in America and other Western countries is fantasy, and that the best move for women was to get as much as she could out of a guy?

It’s possible that getting “as much as she could out of a guy” in terms of money is optimal for an individual woman in some circumstances, but if she plays that game she’s likely to find guys who are unwilling to make long-term investments in her. A guy who pays for sex expects to dump the provider: as the philosopher Charlie Sheen once supposedly said regarding prostitutes, “I don’t pay them for sex. I pay them to leave.”

But there are deeper problems.

Moving unpaid “labor” into the “paid” labor can have the nasty, unintended effect of monetizing a lot of activity that’s better left outside the conventional economy. Roosh is really describing is the difference between a gift economy and market economy, which Lewis Hyde describes in his eponymous book. Moving all or a great deal of sexual activity to a market economy will result in fewer people forming mutually beneficial relationships in which both reap gains from trade and specialization. Monetizing such relationships increases transaction costs for both buyers (men, usually) and sellers (women, usually), which can leave both sides worse off for transaction costs and other reasons.

Ronald Coase’s famous essay “The Nature of the Firm” (alternately, here’s Wikipedia on it) points out that firms exist to reduce friction / transaction costs that arise from alternate arrangements—like having a large number of consultants work together. When individuals are try to gain every last monetary or other advantage at the margin, they aren’t working towards the good of the whole. It’s cheaper and better for large groups of people to get lump-sum payments and then work together, to the best of their abilities, to further the total enterprise. That’s true of firms and of marriages.

A relationship can be conceptualized as a very small firm, as people continually rediscover—in “Marry Him! The case for settling for Mr. Good Enough,” Lori Gottlieb realizes that often “Marriage isn’t a passion-fest; it’s more like a partnership formed to run a very small, mundane, and often boring nonprofit business. And I mean this in a good way.” She realizes this after having a child on her own, however. Instead of figuring out that she can reap major gains from finding a decent guy and marrying him, she decides to date around and has a child via a sperm seller, only to find what should really be obvious and only isn’t to someone who’s been taught to never “compromise.”

As noted above, both parties reap gains from specialization in a firm or marriage: one person might like to cook, for example, while the other person does dishes, or runs errands, or builds stuff. Granted, this only works if both parties actually have useful skills: one time I was in a bar, listening to a nasty-sounding woman complain to two friends, one male and one female, about the guy she was divorcing, and the woman was going on about how she wouldn’t cook, or run errands, or acquiesce to any number of normal-seeming things. Finally I asked her, “What do you bring to the relationship beyond your vagina?” The guy started laughing, hard, and the other woman began chuckling, and the complaining woman didn’t know what to say, so she told me I was rude (true, although I prefer to call it “honest”) and asked how I dare ask her that sort of thing—I dare many things. But she didn’t and probably couldn’t answer the obvious question, perhaps because she already knew the answer in her heart.

The larger point contained in that anecdote, however, is that both parties gain, or should gain, from not having search for sex partners or pay for sex. In addition, long-term plans, like offspring, are easier to make.

Most of us don’t want to live in a purely market economy with every potential transaction: when our significant others come over, we don’t charge them for dinner, and, if we did, the charge would create very different expectations. Dan Ariely describes the expectation issue in Predictably Irrational and elsewhere. Once market norms, as opposed to gift-based norms, are activated, they’re very hard, and perhaps impossible, to de-activate.

Plus, to return to Coase, it’s very inefficient to price everything, and to continually think of pricing. It’s better for individuals and the economy as a whole if people trust each other and create value for each other without (always) charging for it. Relationships are, in part, a movement from market economies to gift economies, and in the process they create a lot of value, along with love, trust, and assorted other positive feelings. If there’s a large-scale culture shift away from non-paying relationships and towards women trying “to get as much as [they] can” out of guys, as Roosh describes, both sides lose, including the woman trading sex for money.

Granted, if a woman isn’t looking for long-term relationships or real help, it can make sense to move to a mercantile economy: this might be why a fair number of college girls get into stripping or even hooking, only to quit at or near graduation: they’re shifting from short-term expectations to long-term ones, and they know that violating social taboos can have a (major) economic payoff, but it’s easy enough for many of them to shift back into the “normal” relationship economy when their interests shift to long-term relationships.


* “Semi-pro” meaning someone who doesn’t explicitly advertise their wares but does eventually demand money for sex, or simply tries to drain guys through overpriced bar drinks and the like.

The creator’s mindset and lawyers’ destructiveness in Cryptonomicon

Rereading Cryptonomicon is always an absurdly pleasurable experience that yields ideas I should’ve noticed before but didn’t. For example, hacker Randy Waterhouse undergoes a life change characteristic not only of numerous nerds I know, who often swerve from the mind-numbingly pointless activities to fantastically enriching ones even though both spring from the same drive, but that also demonstrates the difference between someone who’s just happy to make something and lawyers, who do sometimes deserve their bad rap and rep:

[Randy’s] life had changed when Charlene had come along, and now it changed more: he dropped out of the fantasy role-playing game circuit altogether, stopped going to meetings of the Society for Creative Anachronism, and began to spend all his free time either with Charlene or in front of a computer terminal. All in all, this was probably a change for the better. With Charlene, he did things he wouldn’t have done otherwise, like getting exercise, or going to see live music. And at the computer, he was learning new skills, and he was creating something. It might be something completely useless, but at least he was creating.

“Things he wouldn’t have done otherwise” probably also include showering regular and buying clothes when the old ones develop holes, if Randy is anything like the majors nerds I’ve known and, occasionally, been. Most importantly, he’s making stuff. And that’s what distinguishes Randy, whatever his other problems might be, from everyone else. Lots of people talk about doing things and relatively few do. When you find someone who does stuff, it’s notable, even if the thing “might be something completely useless.”

In Randy’s case, he writes a game based in part on information gleaned from a crazy grad student named Andrew Loeb, and, when Andrew finds out, he ends up suing Randy; when the university whose computers Randy used finds out, they sue him too. Naturally, this is only a very light gloss on how it goes down, like the difference between lipstick and car paint, but events ultimately leave Randy here:

In the end, just to cut his losses and get out of it clean, Randy had to hire a lawyer of his own. The final cost to him was a hair more than five thousand dollars. The software was never sold to anyone, and indeed could not have been; it was so legally encumbered by that point that it would have been like trying to sell someone a rusty Volkswagen that had been dismantled and its parts hidden in attack dog kennels all over the world.

Which, apparently, is what happens when deranged, unreasonable people meet certain kinds of lawyers, or come from them. Randy eventually comes to “decide that Andrew’s life had been fractally weird. That is, you could take any small piece of it and examine it in detail and it, in and of itself, would turn out to be just as complicated and weird as the whole thing in its entirety.” But we have no society-wide immune system to people whose lives are “fractally weird” and want to makes others’ lives miserable, via abusing the legal system or some other means. The people who will make others’ lives miserable don’t really understand the mindset of creators, who’re just trying stuff out to see what happens. And they often don’t realize what other people are like, either, because they haven’t developed the intellectual immune system necessary to protect them from crazy assholes. Creators often live in a gift economy while others live in a commercial economy. So they get in situations like Randy does, having “to hire a lawyer” and cut their losses.

Reading over this post, I realize that, as usual, it’s not really possible to excerpt Cryptonomicon effectively, because the scene in question lasts four densely forested hardcover pages and delves into a level of nuance appropriate for Emacs users. And Stephenson’s novels are fractal too: you can examine almost any segment, from the sentence on up, and find that any part is as detailed and intense as the whole. I haven’t begun to dissect what comparing software, a non-tangible entity that can be infinitely copied with near zero cost, to a Volkswagen, which is quite finite and has many other characteristics separating it from software, actually says about both software and Volkswagens.

Through Randy, however, Stephenson is trying to explain hackers, or at least show one in action, since they’ve been conspicuously absent in literary fiction while probably doing more to change the world than virtually any other group over the last 30 or so years. You can’t really explain their core in a short space, which is why Stephenson devotes about a quarter of a 1,000 page book to examining one, and another quarter or so to examining one’s literal and figurative predecessor. But I could imagine an academic paper examining the construction of a hacker’s temperament, how it differs from the straw-man average man’s temperament, and how an eventual awareness of that difference forms the hacker’s outlook. Randy’s encounter with Andrew can be read as the awareness of that difference coming to the fore, rather as a comic book hero comes to realize that his special powers separate him from his classmates. The difference is that comic book heroes usually have their villains pre-selected and presented as suitably villainous, whereas in life it’s pretty unusual to come across someone as conveniently villainous as Andrew is here.

The creator's mindset and lawyers' destructiveness in Cryptonomicon

Rereading Cryptonomicon is always an absurdly pleasurable experience that yields ideas I should’ve noticed before but didn’t. For example, hacker Randy Waterhouse undergoes a life change characteristic not only of numerous nerds I know, who often swerve from the mind-numbingly pointless activities to fantastically enriching ones even though both spring from the same drive, but that also demonstrates the difference between someone who’s just happy to make something and lawyers, who do sometimes deserve their bad rap and rep:

[Randy’s] life had changed when Charlene had come along, and now it changed more: he dropped out of the fantasy role-playing game circuit altogether, stopped going to meetings of the Society for Creative Anachronism, and began to spend all his free time either with Charlene or in front of a computer terminal. All in all, this was probably a change for the better. With Charlene, he did things he wouldn’t have done otherwise, like getting exercise, or going to see live music. And at the computer, he was learning new skills, and he was creating something. It might be something completely useless, but at least he was creating.

“Things he wouldn’t have done otherwise” probably also include showering regular and buying clothes when the old ones develop holes, if Randy is anything like the majors nerds I’ve known and, occasionally, been. Most importantly, he’s making stuff. And that’s what distinguishes Randy, whatever his other problems might be, from everyone else. Lots of people talk about doing things and relatively few do. When you find someone who does stuff, it’s notable, even if the thing “might be something completely useless.”

In Randy’s case, he writes a game based in part on information gleaned from a crazy grad student named Andrew Loeb, and, when Andrew finds out, he ends up suing Randy; when the university whose computers Randy used finds out, they sue him too. Naturally, this is only a very light gloss on how it goes down, like the difference between lipstick and car paint, but events ultimately leave Randy here:

In the end, just to cut his losses and get out of it clean, Randy had to hire a lawyer of his own. The final cost to him was a hair more than five thousand dollars. The software was never sold to anyone, and indeed could not have been; it was so legally encumbered by that point that it would have been like trying to sell someone a rusty Volkswagen that had been dismantled and its parts hidden in attack dog kennels all over the world.

Which, apparently, is what happens when deranged, unreasonable people meet certain kinds of lawyers, or come from them. Randy eventually comes to “decide that Andrew’s life had been fractally weird. That is, you could take any small piece of it and examine it in detail and it, in and of itself, would turn out to be just as complicated and weird as the whole thing in its entirety.” But we have no society-wide immune system to people whose lives are “fractally weird” and want to makes others’ lives miserable, via abusing the legal system or some other means. The people who will make others’ lives miserable don’t really understand the mindset of creators, who’re just trying stuff out to see what happens. And they often don’t realize what other people are like, either, because they haven’t developed the intellectual immune system necessary to protect them from crazy assholes. Creators often live in a gift economy while others live in a commercial economy. So they get in situations like Randy does, having “to hire a lawyer” and cut their losses.

Reading over this post, I realize that, as usual, it’s not really possible to excerpt Cryptonomicon effectively, because the scene in question lasts four densely forested hardcover pages and delves into a level of nuance appropriate for Emacs users. And Stephenson’s novels are fractal too: you can examine almost any segment, from the sentence on up, and find that any part is as detailed and intense as the whole. I haven’t begun to dissect what comparing software, a non-tangible entity that can be infinitely copied with near zero cost, to a Volkswagen, which is quite finite and has many other characteristics separating it from software, actually says about both software and Volkswagens.

Through Randy, however, Stephenson is trying to explain hackers, or at least show one in action, since they’ve been conspicuously absent in literary fiction while probably doing more to change the world than virtually any other group over the last 30 or so years. You can’t really explain their core in a short space, which is why Stephenson devotes about a quarter of a 1,000 page book to examining one, and another quarter or so to examining one’s literal and figurative predecessor. But I could imagine an academic paper examining the construction of a hacker’s temperament, how it differs from the straw-man average man’s temperament, and how an eventual awareness of that difference forms the hacker’s outlook. Randy’s encounter with Andrew can be read as the awareness of that difference coming to the fore, rather as a comic book hero comes to realize that his special powers separate him from his classmates. The difference is that comic book heroes usually have their villains pre-selected and presented as suitably villainous, whereas in life it’s pretty unusual to come across someone as conveniently villainous as Andrew is here.

The Gift — Lewis Hyde

Lewis Hyde’s The Gift is one of these frustrating books whose last chapter is vastly better than any other and whose main point is somehow true even as the support for that point is weak, nonexistent, or wrong. He argues, reasonably enough, that contemporary Western capitalist societies tend to undervalue creativity in the arts, particularly when said creativity doesn’t sell. But in trying to make his point, he too pretends that a firewall exists between the creative, “gift” economies and the exchange/contract economies. At the end he decides the two can be reconciled, but that occurs after a series of irritating pronouncements with unsubtle jabs the exchange/contract economy. Nonetheless, The Gift made me think differently about the world by the time I finished with it, which few books do. I’ll swing back to that at the end, because The Gift also deserves plenty of criticism.

Although The Gift is a book, it feels like a long magazine article might have been the more appropriate form for it. Do we really need more than 50 pages about American Indian gift exchange cultures? And the chapters on Ezra Pound seems particularly worthless, and the one on Whitman interesting but overlong—a microcosm for The Gift as a whole. Some of its metaphors strain credulity and seem almost deliberately narrow, as when Hyde writes:

Gifts of peace have the same synthetic character. Gifts have always constituted peace overtures among tribal groups and they still signify the close of war in the modern world, as when the United States helped Japan to rebuild after the Second World War. A gift is often the first step toward normalized relations. (To take a negative example, the United States did not offer aid to Vietnam after the war. […])

The United States didn’t rebuilt Japan in hopes of joining hands and singing about world harmony—the goal was to build Japan as a bulwark against Communism in Asia. The “gifts” were probably closer to bribes. At the same time, the United States didn’t win in Vietnam, which might explain why no foreign aid money went to the country; if the North had been overrun and destroyed, then it might have been rebuilt with American dollars. Likewise, the United States’ proxy war in Afghanistan resulted in little subsequent aid, as discussed at the end of George Crile’s Charlie Wilson’s War.

I’m not sure this shows anything other than Hyde failed in this example, but he does in many others too. In a footnote, he says:

There is no technology, no time-saving device that can alter the rhythms of creative labor. When the worth of labor is expressed in terms of exchange value, therefore, creativity is automatically devalued every time there is an advance in the technology of work.

Time-saving devices can free up more time for creative labor: there are more writers and artists today than there were in, say, 1800, in part because most people aren’t engaged in backbreaking farming or 15-hour days in factories. Education levels have risen enormously, in part thanks largely to time-saving devices that give us more time to study and more wealth to devote to schools, libraries, and the like. Furthermore, labor expressed in exchange value does not automatically devalue creativity—establishing things like copyright, which allowed writers and others to derive an independent income from their work, if anything increased the worth of creative labor for people like writers. And creativity is not limited to what we think of as traditional arts—for example, computer programming is often enormously creative, and those who tend to be maximally creative also tend to be better compensated than those who aren’t. If Hyde were going to say that “When the worth of labor is expressed in terms of exchange value, creativity can be devalued,” I would agree: the number of poets whose contribution can be measured monetarily is small. As Gabriel Zaid says in So Many Books: Reading and Publishing in an Age of Abundance, “[…] the conversation continues, unheeded by television, which will never report: ‘Yesterday, a student read Socrates’ Apology and felt free.’ ”

Such problems occur throughout the book, although they’re alleviated in the conclusion, where Hyde retreats on many of his more ridiculous assertions. He says:

[…] my own ideas underwent a bit of a re-formation. I began to understand that the permission to usure is also a permission to trade between two spheres [the commercial and gift economies]. The boundary can be permeable. Gift-increase (unreckoned, positive reciprocity) may be converted into market-increase (reckoned, negative reciprocity). And vice versa: the interest that a stranger pays on a loan may be brought into the center and converted into gifts. Put more generally, within certain limits what has been given us as a gift may be sold in the marketplace and what has been earned in the marketplace may be given as a gift.

Damn: if only that line of reasonable thinking had informed the entire book. It didn’t, which render sections of The Gift reminiscent of freshman-year manifestos written by tipsy students who just finished Marx. Despite those problems, some sections early fascinate, like the chapter on “The Gift Community,” where Hyde says:

Is is a rare society that can be sustained by bonds of affection alone; most, and particularly mass societies, must have as well those unions which are sanctioned and enforced by law that is detached from feeling. But just as the Roman saw the familia divided into res and personae, the modern world has seen the extension of law further and further into what was earlier the exclusive realm of the heart.

The more one tries to regulate the affairs of the heart, the less those affairs seem like they are of the heart. Dan Ariely and Tim Harford make similar observations, backed up by experiments, in Predictably Irrational and The Logic of Life, respectively. And institutions are fond of exploiting the gift economy by masquerading their exchange/commercial actions. For example, Division I American college sports piggyback on the gift economy: although to football, basketball and baseball players are essentially professionals, high-caliber universities pretend that tuition is a “gift” even as the same universities extract millions of dollars in television and merchandising revenue from such players. The idea that Division I players are amateurs has become increasingly absurd, much as the Olympics have been professionalized. In Beer and Circus: How Big-Time Sports Is Crippling Undergraduate Education, Murray Sperber even argues that the sports mentality harms students.

Yet I can’t help but imagine places where gift economies don’t apply at all, and they’re often not very pleasant. As I write this, I sit in a Tucson airpot bar. Airports have everything wrong with them: they are transitional, one-off spaces filled with strangers, the “restaurants” they offer consist of pre-made food with character slightly above a TV dinner, and for some reason we as a society have decided that Constitution rights and privacy don’t apply here. People I don’t know can stop me at will, and merely flying requires that I submit to security theater that is simultaneously ineffective and invasive. Everything is exorbitantly expensive but not of particularly high quality. Menus don’t have beer prices on them.

The airport, in short, is designed to extract money from a captive audience; this might be in part why I don’t care much for sports stadiums, Disneyland, and other areas where I feel vaguely captive. In Great American Cities (to use Jane Jacob’s phrase), something is always happening, there is always another place down the street, and you can decide to be as invested or anonymous in society as you like. In contrast, airpots feel like a trap: you can’t choose to avoid them, at least not without enormous costs in terms of time, money, and concentration. Maybe I wrote about college sports above because a few basketball games are playing around me, along with facile, noisy political news that’s more like a talk show than newspaper. If there were a bar in the Tucson airport without this ceaseless parade of visual noise, I would go to it. I’m trapped in an extreme form of the market economy, where no reciprocity exists and the gift is hidden and completely subservient to commerce. I might not have the gift, but regardless of whether I do, I’m frustrated here, where the food is more fuel more pleasure, as if choosing between burritos and pasta is like choosing between octane grades. Good chefs are artists, and maybe none could work in the security of an airport. I only wish that I had somewhere quiet and comfortable to sit. Neither kind of place exists in airports, unless you pay for it, and, again, I have no choice but to participate. At least with the most market, you have a choice.

In short, there are few better places to instill sympathy to the arguments of a book like The Gift, which, for all its problems in expression, nonetheless drives at a serious problem in market economies that seem unlikely to depart. They are not as serious as Hyde makes them out to be—I too would like it if more people read Saul Bellow and fewer watched Flavor of Love, a show I’ve never seen but have heard allusions to at least three times in the last week—and the market has a habit of self-correction, but that doesn’t mean they do not exist. And The Gift gives one a better way for analyzing the world and believing in creative acts that don’t necessary have immediate financial gain.

Despite my antipathy towards The Gift I occasionally find myself recommending it, albeit with caveats attached. It threads an argument that deserves to be more often heard in a non-sentimental or strident context: that not all worthy forms of creativity are financially remunerated adequately but that they are valuable nonetheless. The Gift is not brilliant, as the jacket copy claims, but art deserves all the defense it can muster, but over the long term, I suspect that art will be its own defense.

Publishing Industry Gloom is Readers' Gain

Bargain Hunting for Books, and Feeling Sheepish About It almost perfectly describes my book habits. The major difference is that I carefully examine the used and new prices; if they are sufficiently close, especially given shipping charges, I go new. But they often aren’t. Read the article and note this:

And what of the woman who sold me the [used] book [over the Internet]? She told me via e-mail that her real name was Heather Mash and that she worked as a domestic violence case manager in a women’s shelter not too far from Berkeley. She didn’t set out to subvert the publishing and bookselling world, she said. Like most of us who sell online, Ms. Mash began because she had too many books and wanted to raise money to buy more. “I would rather sell a book for a penny and let someone enjoy it than keep it collecting dust,” she said.

Many of the scholarly books I own concerning Melville or Tolkien would once have been unavailable or, if they were available, ludicrously expensive, and reading them probably would’ve required a good university library. Now I can buy them relatively cheaply; instead of $20 for Jane Chance’s The Mythology of Power, I got it for $4 or $5, counting shipping. Once, such books probably wouldn’t even have been available in paperback; the only option would’ve been hardbacks costing $45 – $100.

Although the New York Times article implies this hurts the publishing industry, I wonder if it really helps: a decreasing reliance on old books (or the “catalog”) means that publishers will be forced to pay more attention to new books if they are to make any money. At the same time, the real question is the extent to which used books are substitutes or complements for real books. With some works—like the classics cited in the article—the answer seems to be substitutes. With others, though, I suspect that readers are more likely to buy more books because they can better afford it.

The article implies that Amazon is partially a problem, but I would observe that people use Amazon because Amazon is incredibly, extraordinarily easy and cheap. It’s also simple to learn, as if easy and cheap weren’t enough. And the selection is good; for example, I recently mentioned Norman Rush’s extraordinary novel Mating in a post on The Mind-Body Problem. At this Amazon link, a dozen hardcover copies are available for “$0.01,” although this is deceptive because the $3.99 in shipping means that you’re actually paying $4. Still, that’s incredibly cheap; in a Seattle used bookstore not long ago, I saw a hardcover copy for $11. Furthermore, you can’t even buy new hardcover copies of Mating, and a used hardcover will probably last longer than a new paperback. Is it any surprise that I react to this situation with self-interest?

What can or should publishers do? I’m not entirely sure, but I suspect it means competing with their own catalog in terms of price. Or it might mean something else; I’m reminded of Ursula K. Le Guin’s excellent piece in Harper’s, Staying awake: Notes on the alleged decline of reading:

Books are social vectors, but publishers have been slow to see it. They barely even noticed book clubs until Oprah goosed them. But then the stupidity of the contemporary, corporation-owned publishing company is fathomless: they think they can sell books as commodities.

[…]

I keep hoping the corporations will wake up and realize that publishing is not, in fact, a normal business with a nice healthy relationship to capitalism. Elements of publishing are, or can be forced to be, successfully capitalistic: the textbook industry is all too clear a proof of that. How-to books and the like have some market predictability. But inevitably some of what publishers publish is, or is partly, literature—art. And the relationship of art to capitalism is, to put it mildly, vexed. It has not been a happy marriage. Amused contempt is about the pleasantest emotion either partner feels for the other. Their definitions of what profiteth a man are too different.

And one more point, this one from The Zen of Graphics Programming by way of a Slashdot comment:

Anecdote the third: A while back, I had the good fortune to have lunch down by Seattle’s waterfront with Neal Stephenson, the author of Snow Crash and The Diamond Age (one of the best SF books I’ve come across in a long time). As he talked about the nature of networked technology and what he hoped to see emerge, he mentioned that a couple of blocks down the street was the pawn shop where Jimi Hendrix bought his first guitar. His point was that if a cheap guitar hadn’t been available, Hendrix’s unique talent would never have emerged. Similarly, he views the networking of society as a way to get affordable creative tools to many people, so as much talent as possible can be unearthed and developed.

This semester, the University of Arizona bookstore charged around $400 for class books, or around $340 used. A combination of new and used books from Amazon ran to about $250. I’ll keep the $150, thanks. But I’ll probably end up spending the rest on other books.

Publishing Industry Gloom is Readers’ Gain

Bargain Hunting for Books, and Feeling Sheepish About It almost perfectly describes my book habits. The major difference is that I carefully examine the used and new prices; if they are sufficiently close, especially given shipping charges, I go new. But they often aren’t. Read the article and note this:

And what of the woman who sold me the [used] book [over the Internet]? She told me via e-mail that her real name was Heather Mash and that she worked as a domestic violence case manager in a women’s shelter not too far from Berkeley. She didn’t set out to subvert the publishing and bookselling world, she said. Like most of us who sell online, Ms. Mash began because she had too many books and wanted to raise money to buy more. “I would rather sell a book for a penny and let someone enjoy it than keep it collecting dust,” she said.

Many of the scholarly books I own concerning Melville or Tolkien would once have been unavailable or, if they were available, ludicrously expensive, and reading them probably would’ve required a good university library. Now I can buy them relatively cheaply; instead of $20 for Jane Chance’s The Mythology of Power, I got it for $4 or $5, counting shipping. Once, such books probably wouldn’t even have been available in paperback; the only option would’ve been hardbacks costing $45 – $100.

Although the New York Times article implies this hurts the publishing industry, I wonder if it really helps: a decreasing reliance on old books (or the “catalog”) means that publishers will be forced to pay more attention to new books if they are to make any money. At the same time, the real question is the extent to which used books are substitutes or complements for real books. With some works—like the classics cited in the article—the answer seems to be substitutes. With others, though, I suspect that readers are more likely to buy more books because they can better afford it.

The article implies that Amazon is partially a problem, but I would observe that people use Amazon because Amazon is incredibly, extraordinarily easy and cheap. It’s also simple to learn, as if easy and cheap weren’t enough. And the selection is good; for example, I recently mentioned Norman Rush’s extraordinary novel Mating in a post on The Mind-Body Problem. At this Amazon link, a dozen hardcover copies are available for “$0.01,” although this is deceptive because the $3.99 in shipping means that you’re actually paying $4. Still, that’s incredibly cheap; in a Seattle used bookstore not long ago, I saw a hardcover copy for $11. Furthermore, you can’t even buy new hardcover copies of Mating, and a used hardcover will probably last longer than a new paperback. Is it any surprise that I react to this situation with self-interest?

What can or should publishers do? I’m not entirely sure, but I suspect it means competing with their own catalog in terms of price. Or it might mean something else; I’m reminded of Ursula K. Le Guin’s excellent piece in Harper’s, Staying awake: Notes on the alleged decline of reading:

Books are social vectors, but publishers have been slow to see it. They barely even noticed book clubs until Oprah goosed them. But then the stupidity of the contemporary, corporation-owned publishing company is fathomless: they think they can sell books as commodities.

[…]

I keep hoping the corporations will wake up and realize that publishing is not, in fact, a normal business with a nice healthy relationship to capitalism. Elements of publishing are, or can be forced to be, successfully capitalistic: the textbook industry is all too clear a proof of that. How-to books and the like have some market predictability. But inevitably some of what publishers publish is, or is partly, literature—art. And the relationship of art to capitalism is, to put it mildly, vexed. It has not been a happy marriage. Amused contempt is about the pleasantest emotion either partner feels for the other. Their definitions of what profiteth a man are too different.

And one more point, this one from The Zen of Graphics Programming by way of a Slashdot comment:

Anecdote the third: A while back, I had the good fortune to have lunch down by Seattle’s waterfront with Neal Stephenson, the author of Snow Crash and The Diamond Age (one of the best SF books I’ve come across in a long time). As he talked about the nature of networked technology and what he hoped to see emerge, he mentioned that a couple of blocks down the street was the pawn shop where Jimi Hendrix bought his first guitar. His point was that if a cheap guitar hadn’t been available, Hendrix’s unique talent would never have emerged. Similarly, he views the networking of society as a way to get affordable creative tools to many people, so as much talent as possible can be unearthed and developed.

This semester, the University of Arizona bookstore charged around $400 for class books, or around $340 used. A combination of new and used books from Amazon ran to about $250. I’ll keep the $150, thanks. But I’ll probably end up spending the rest on other books.

Links: Freedom, humanity, universal empathy, and other such small topics

* MercatorNet’s John Armstrong argues that “Economic freedom has turned toxic because we lack the cultural maturity that the humanities used to provide” (hat tip NYT Ideas Blog). Although I’m naturally susceptible to arguments like this:

The long-term health of the economy depends on the flourishing of the humanities: an important factor in our present troubles is their self-imposed weakness.

The dependency is hard to see because the standard ways in which we think about capitalism and the humanities are misleading.

I also find them difficult to believe. Armstrong’s historical view implies that the humanities once had a much stronger influence on public life, which is possible, but even if they did, boom/bust cycles far worse than this one were common in the 19th Century, as this list indicates (the panic of 1893 was particularly grim). Humanities or no, panics and boom/bust cycles might be part of human psychology and behavior, as Henry Blodget argues in “Why Wall Street Always Blows It:”

But most bubbles are the product of more than just bad faith, or incompetence, or rank stupidity; the interaction of human psychology with a market economy practically ensures that they will form. In this sense, bubbles are perfectly rational—or at least they’re a rational and unavoidable by-product of capitalism (which, as Winston Churchill might have said, is the worst economic system on the planet except for all the others). Technology and circumstances change, but the human animal doesn’t. And markets are ultimately about people.

He gives numerous examples of bubble behavior in action, along with small-scale studies that seem to demonstrate bubble behavior even in controlled environments. The humanities might offer many benefits, pleasure chief among them, even if doing so is unlikely to prevent bubbles or take the rough edges off capitalism. Or maybe not: Paul Graham asks “Is It Worth Being Wise?” and basically answers “yes, but not as important as intelligence.” He defines “wise” and “intelligent” throughout the essay, for those of you wondering why he’d set near synonyms as opposites. Graham, however, probably has the culture maturity Armstrong writes about and thus probably takes it for granted in a way that allows him to disparage the humanities more than he probably should. That disparagement occurs throughout his essay, and although many of his criticisms are valid, he overstretches them, much as Armstrong probably overstretches the virtues of the humanities.

Maybe Armstrong is suggesting the second great purpose of art, as described by D.H. Lawrence in Studies in Classic American Literature:

Art has two great functions. First, it provides an emotional experience. And then, if we have the courage of our own feelings, it becomes a mine of practical truth. We have had the feelings ad nauseam. But we’ve never dared dig the actual truth out of them, the truth that concerns us…

I’m not sure art has any practical truths to offer: like Nabokov, I suspect art’s chief purpose is itself and aesthetic bliss, and as such, any practical truths are at best secondary. Or maybe art is whatever we make it to be, and Armstrong’s effort to make the humanities—of which art is a large part—into a helper of the SEC is as valid as Nabokov’s belief in art as itself. The challenge in implementing Armstrong’s view is that convincing banking executives to start reading, say, Dr. Faustus and The Lord of the Rings, seems rather improbable. And even if they did, it’s still an overly large leap to imagine that doing so will tangibly improve the economic situation.

Alas, I’m using what humanities knowledge I have to argue against the importance of the humanities, at least for the reasons stated in the article. Perhaps that’s one of the humanities’ major problems: its own practitioners doubt its utility and have the skills to point out why.

* Mark Sarvas recommends The Gift, a book he praises in unusual terms: “I’m often asked why I persist here at TEV for no financial rewards. The best answer I can offer is to stick a copy of The Gift into your hands, albeit virtually.”

With an endorsement like that, expect a post on The Gift sometime in the not-too-distant future.

* By way of The Elegant Variation once again, read about the power of fiction to portray other worlds in our own world. To use one example from the article:

Yet even if we understand things as narratives, most of us would rather read the traditional story presented by a novel than we would the rather dryer story of a policy report. Best-selling novels such as Khaled Hosseini’s The Kite Runner thus reach a huge audience (especially when helped along by the other great narrative art and made into a blockbuster film) whilst academic research, no matter how insightful, will never be read by millions. Which is why the report’s authors venture that Hosseini’s novel has probably “done more to educate western readers about the realities of daily life in Afghanistan than any government media campaign, advocacy organisation report, or social science research.”

I’ve heard of—who hasn’t?—but never read The Kite Runner and so can’t comment on that in particular, but it’s hard to deny the power of narratives to fiction in general. I’ve begun reading a triple-pack of Henry Green’s novels, Loving; Living; Party Going, and they seem as close to working-class Britain circa World War II as I’m ever going to get. When this mimetic function fails, the novel often fails with it, and here I’m thinking of novels like Waverley and The Other Boleyn Girl.

Consider that article as reinforcement regarding the second of D.H. Lawrence’s propositions regarding art, as already stated above:

Art has two great functions. First, it provides an emotional experience. And then, if we have the courage of our own feelings, it becomes a mine of practical truth. We have had the feelings ad nauseam. But we’ve never dared dig the actual truth out of them, the truth that concerns us…

* More on the maybe-changes in culture being driven by video:

When technology shifts, it bends the culture. Once, long ago, culture revolved around the spoken word. The oral skills of memorization, recitation and rhetoric instilled in societies a reverence for the past, the ambiguous, the ornate and the subjective. Then, about 500 years ago, orality was overthrown by technology. Gutenberg’s invention of metallic movable type elevated writing into a central position in the culture. By the means of cheap and perfect copies, text became the engine of change and the foundation of stability. From printing came journalism, science and the mathematics of libraries and law. The distribution-and-display device that we call printing instilled in society a reverence for precision (of black ink on white paper), an appreciation for linear logic (in a sentence), a passion for objectivity (of printed fact) and an allegiance to authority (via authors), whose truth was as fixed and final as a book.

The passage indicates the questionable grandiosity in tone, but the thinking about what the pervasiveness of video says regarding society is still worthwhile.

* If you’ve read that, you much deserve a break, and Quid plura? offers one:

…and then, once in a while, you’re invited to yak it up at a writers’ event, and you retire to a pizza joint for a late night of unrepeatable stories with smart, funny people, and you begin to understand the value of your 300-page calling card beyond the reviews and royalty statements. Writers like to gripe and whine, but when it comes to this one benefit, don’t let authors tell you otherwise, not even my fellow recluses. The social aspect, unlike the process of writing itself, is even more fun than you think it will be.

* The publishing industry is of less interest to me than actual reading, but nonetheless this insightful bit from the New Yorker’s book blog is fascinating.

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