The Benefits of Diverse Preferences in Library Consortia

31 Pages Posted: 1 May 2017

See all articles by Doh-Shin Jeon

Doh-Shin Jeon

Toulouse School of Economics (TSE); Centre for Economic Policy Research (CEPR)

Domenico Menicucci

Universita' degli Studi di Firenze

Date Written: March 2017

Abstract

We study the case in which a library consortium increases the aggregate payoff of the member libraries. We find that libraries with similar preferences are likely to lose from building a consortium and that those with diverse preferences are likely to gain by doing so. Combining libraries with diverse preferences implies that their valuation for different publishers’ journals is more symmetric, which intensifies competition among publishers for scarce combined budgets. A tension between short term and long term considerations might generate a ‘library consortium trap.’ Our insight can be applied to other buyer groups as long as competition is generated by buyers’ budget constraints.

Suggested Citation

Jeon, Doh-Shin and Menicucci, Domenico, The Benefits of Diverse Preferences in Library Consortia (March 2017). The Journal of Industrial Economics, Vol. 65, Issue 1, pp. 105-135, 2017, Available at SSRN: https://ssrn.com/abstract=2960377 or http://dx.doi.org/10.1111/joie.12123

Doh-Shin Jeon (Contact Author)

Toulouse School of Economics (TSE) ( email )

Place Anatole-France
Toulouse Cedex, F-31042
France

Centre for Economic Policy Research (CEPR)

London
United Kingdom

Domenico Menicucci

Universita' degli Studi di Firenze ( email )

via delle pandette 9
Firenze, 50127
Italy
+39-055-4374666 (Phone)
+39-055-4374913 (Fax)

HOME PAGE: http://www.dmd.unifi.it/index.php?loc=personal&id=d.menicucci

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