Inclusive and Extractive Economies in Publishing

I have been reading a book on global economics, “Why Nations Fail: The Origins of Power, Prosperity, and Poverty” by Daron Acemoglu and James A. Robinson, and my thoughts, as always, turn to publishing.

You don’t have to agree with everything the book says to be stimulated by its ideas.  It posits that political and economic institutions are mainly responsible for a nation’s poverty or prosperity rather than commonly held theories highlighting geography, culture, or the ignorance of their leaders.  When institutions are inclusive, that is, democratic and open to new ideas, technologies, innovators, and entrepreneurs, a nation flourishes.  However, when institutions become exclusive, that is, they exist for the enrichment of a small group of elite, they may experience growth, even rapid growth, for a while, but it is unsustainable due to the lack of incentive to develop new technologies or foster new investors for further growth.  The authors time travel through history giving the reader a myriad examples to support their theories, on the way explaining why other theories, such as Jared Diamond’s theory, as put forth in the prize-winning “Guns, Germs, and Steel,” of the natural resources in an area determining its prosperity, are inadequate or incomplete.

And so, of course, I inevitably begin to compare these economic postulations with the state of publishing today.  As writers see the field, which institutions are inclusive and which are extractive?  We have Amazon and other self-publishing venues on the one hand which have developed cutting-edge technologies, put them out on the market for free use, opened the gates wide for authors and other artists, and invited them to come share the wealth for a percentage of profits.  We have the oligarchs of big publishing on the other hand, who tell writers that these self-publishing venues are exploitive, that they encourage substandard work, that they upset the status quo, that they are not part of the traditional pattern of things.  It reminds me of the reaction of guilds of scribes after Gutenberg invented printing and moveable type.  Amazon is obviously and blatantly inclusive, while traditional publishing has always been exclusive and extractive, taking as many rights from authors that they possibly can while paying them as little as possible.  Apart from a few big-name authors who receive big advances, authors in a publishing company’s stable function as serfs, enduring the hard work of creation while passing on the bulk of the profits to overseers.

If this was all that was happening, however, it would not account for traditional publishing’s extreme reactions in the face of self-publishing.  After all, one would think, why should they care if people self-publish their books?  Traditional publishers posit that those works will get lost in a crowd of other works and come to nothing anyway.

But there is another extremely vital factor at work, and it is the reason that scribe guilds rose up against Gutenberg, and why the Luddites in England rose up against the Industrial Revolution.  It is what the authors of this book call creative destruction.  In an inclusive economic system, new technologies and innovations do not exist amicably together side by side with the old.  The new inevitably destroys or alters the old.  That’s why traditional publishing companies and authors who make their livings off the old system of publishing are up in arms against self-publishing and all the changes it brings about.  They see old facades and structures crumbling around them as the new systems assert themselves.  Change does not allow the intact preservation of the old.  Although inclusive economies may mean more prosperity for more people, the extractive elite inevitably lose out as the wealth becomes better distributed.  Since their prosperity is built on exploitation and exclusivity, if they want to retain their positions at the top of the pyramid they can do nothing else than fight back against the technologies that threaten them.  They could, theoretically, embrace the new technologies and welcome the changes, but it’s unusual throughout history for extractive institutions to do so, because by their nature they pander to a pampered elite.

I don’t think that self-publishing will completely destroy traditional publishing, but I do think that drastic changes to the publishing landscape are inevitable and irrevocable.  There’s no going back.  And the harder institutions and individuals fight against innovations, the harder it is for them to adapt and benefit from them.  When extractive institutions fall, they often fall hard and fast because of their lack of resiliency and flexibility.  They can’t bend in a storm, so they break.  The only way to grow is to embrace creative destruction, not attempt to forestall or avoid it.  What the authors of the book call historical critical junctures arise from time to time; institutions that have brought themselves to a point in which they are open to progress benefit, while others shatter or decay.

Analogies are not always precise or all-encompassing, and the complexity of social, political, and financial situations precludes neatly describing them in a few catchphrases, but these thoughts might help bring things into slightly better focus.

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2 Responses to Inclusive and Extractive Economies in Publishing

  1. Pingback: Inclusive and Extractive Economies in Publishing | The Passive Voice | A Lawyer's Thoughts on Authors, Self-Publishing and Traditional Publishing

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