Book publishing - competition, technological innovation, and structural changes: an examination of the US book industry

Abstract

Technological changes, demand shift, and mergers and acquisitions are three major forces that affected the book publishing industry in the late 20th century. Escalation in input costs and subsequent fall in profits led to a host of mergers and acquisitions in the publishing industry in the USA and Europe, mainly in the 1960s and in the 1980s. The consolidation is believed to have increased the industry concentration and the market share of the largest firms, leading to an oligopolistic structure, greater market power of firms and higher prices. However, despite the mergers, the US book industry remained monopolistically competitive in the latter half of the 20th century, except for a brief period in the late 1990s when it showed oligopolistic trends. Thus, contrary to the general belief, consolidation in the US book industry might not be a major cause for the rise in prices of books since 1960s.