Economics 101 and Scholarly Publishing

It's time to go back to your old edition of Samuelson's Economics and re-read the description of "inelasticity" in reference to supply and demand. In general, you will find that high-priced goods and services that do not give rise to competing goods or services at lower prices are exhibiting inelastic behavior. A classic example is critical care surgery. The current debate over managed care reflects historic inelasticity in the health care market.

What's Wrong With This Picture?

Scholarly publishing is the life blood of a research university and its library. However, these publications have a very limited, niche market focused on research libraries and the scholars who share a discipline. Current supply and demand analyses of scholarly publishing describe a highly inelastic system. Research journals are extremely expensive, and many commercially published journals have an extraordinarily high return on investment (ROI). Recently, when I asked a representative of the Association of American Publishers what a reasonable ROI for a scholarly publisher might be, he replied that lO% was viewed as reasonable.Yet we know of significant commercial examples where the ROI is 40%. We are also aware that not-for-profit scholarly societies can and do publish similar articles for one-half to one- third of the per page cost charged by some commercial publishers. Despite such cost differentials, and even with significant ROI figures as encouragement, we do not have increased competition.

We have seen, over more than a decade of annual doube-didgit inflation in scholarly publication prices, the consequent decline in subscriptions to journals and purchases of books. Each year the library spends more money, more in fact than the annual percentage increase in the cost of living, to purchase fewer books and journals. Inelasticity in the market is slowly but inexorably bringing about the collapse of the current process for scholarly publication.

We Need Competition

The Association of Research Libraries (ARL) is sponsoring a project intended to create competition in the market for scholarly publication: SPARC, the Scholarly Publishing and Academic Resource Coalition. Injust two months, with no publicity or marketing, more than 70 ARL research libraries, including the University of Connecticut Libraries, have signed on as charter members and have contributed significant start-up funds. These libraries, with'total acquisition budgets of nearly $500 million each year, are a significant force in the scholarly publishing market. Other libraries will soon be invited to join the coalition.

Starting with prestigious scholarly societies, SPARC will encourage selected publishing partners to develop new journals to compete, head to head, with existing high-priced commercial journals. SPARC library members will help to secure subscriptions, and we will work with our faculties to build strong editorial boards and to encourage manuscript submissions. Significant projects are and will be announced publicly in the near future.

The key to addressing the crisis in scholarly publishing is a competitive marketplace. In such an environment, the scholarly communtity can begin to reestablish equitable pricing, enhance their rights to the fair use of scholarly information, encourage faster turnaround time from submission to publication, and encourage the creative use of technology to permit the use of multi-media in publication.

SPARC is a significant first step. You can learn more about it on the Web at www.arl.org/sparc/index.html. Revearsing the current situation will be long and arduous. I'll keep you posted. I appreciate your attention, and now feel free to return your copy of Samuelson to its place on the shelf

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