Thursday, October 29, 2009

Is Amazon predatory?

Chapter 17 of my favorite textbook has a section on controversies over antitrust policy, including a discussion of predatory pricing. This topic is in the news again: The American Booksellers Association says Amazon, Wal-Mart, and Target "are using these predatory pricing practices to attempt to win control of the market for hardcover bestsellers" and that this behavior "is damaging to the book industry and harmful to consumers."

Read more about the case here and here.

The so-called predatory price cuts have not spilled over to the sale of textbooks. Is that good news for students (as the Booksellers' argument suggests) or bad news?