Sunday, May 3, 2009

Louise Adler and Australian stories

I have previously posted on the Productivity Commission's draft report Restrictions on the Parallel Importation of Books. As part of its proposed package of changes, the Commission proposed that the restrictions on parallel imports should apply for only 12 months from the date of first publication of a book in Australia, as opposed to the current arrangements whereby restrictions can potentially apply for the full term of copyright.

In today's Sunday Age, Louise Adler criticises the recommendations, and argues that
.... a marketplace that abolishes the principle of territorial copyright will wind back the clock on a proud and profitable publishing culture, reduce the availability of Australian stories and hand back a monopoly to multinational publishers to make decisions about our market far removed from local realities.

As I have posted previously, parallel import restrictions allow authors and publishers to price discriminate. Restricting supply in the domestic market results in prices for books being higher than elsewhere. While part of the loss of surplus to consumers is transferred to publishers(including foreign owned publishers), part of it is not, and can be considered a deadweight loss. The deadweight loss also includes the extra costs to society of publishing books domestically that could have been imported more cheaply. As CEO and publisher-in-chief of Melbourne University Publishing, Louise Adler obviously has an interest in defending the status quo.

What is also interesting, albeit not suprising, is the way in which the protectionist argument is regularly couched in terms of protecting an "authentic Australian cultural identity" for the benefit of Australian consumers. This argument is without foundation. If an author was concerned about the importation of remainders displacing existing domestic sales, the relaxation of parallel import restrictions on books would primarily affect an author's decision to supply the overseas market, not the domestic market. Furthermore, if there is any relationship between the magnitude of "authentic Australian cultural" externalities and the expected size of the overseas market for particular books, it can be expected to be negative, rather than positive.

Louise Adler supports the retention of a policy that tends to disproportionately benefit those authors who expect large overseas sales, at the expense of domestic consumers. To couch her protectionist argument in terms of ensuring the continued supply of Australian stories for the benefit of Australian consumers is disingenuous at best.


  1. Parallel imports kill australian jobs.
    Look at your local area.
    When they brought these laws in for CD's
    A few bargain basement cd shop selling cheap imports popped up.
    Then what happened to those other record shop's that have been running for years!
    They closed down.
    It's such a culture destroyer because..
    instead of finding locally made cd's and large back catalogues of aus artist's.
    You find just the big selling overseas artist's.
    Boring I hope this doesn't happen to our books too!

  2. There go your chances of being published in Australia. You have upset The Melbourne University Establishment, tut tut.