Displacement effects of public libraries
BibTeX
@article{kanazawa2022displacement,
title={Displacement effects of public libraries},
author={Kanazawa, Kyogo and Kawaguchi, Kohei},
journal={Journal of the Japanese and International Economies},
volume={66},
pages={101219},
year={2022},
publisher={Elsevier}
}
Abstract
If free lending in public libraries is displacing sales in bookstores, some compensation may be needed to maintain incentives for authors to create new works. To determine whether this is indeed the case, we created a novel dataset that integrated bookstore sales data with public library copy data in Japan and quantified the displacement effects of public libraries. Controls for title-municipality, months-after-publication, and municipality-month-specific unobserved heterogeneity were introduced. The study found that a library copy displaced the sales of the title in the municipality by approximately 0.24 copies per month for the top 1/6 popular books and 0.52 copies for bestsellers. Various robustness checks were consistent with the baseline results; thus, the study confirmed the displacement effects of popular books.
Notes
A priori, it seems like the effect of libraries on book sales should be ambiguous, right?
On the one hand, a public library is kinda like the government covering the transactions costs of the secondary market.
On the other hand, the government is literally buying extra copies of the books.
This paper does a correlation to estimate how many private book sales that library copy displaces. For the top selling books, it sounds like the displacement is large enough to exceed the positive impact of the library’s purchase. But for less well selling books, libraries have negligible effect on private sales, so should on net increase total sales.
That lines up with my intuition.