Young Economics.

Archive for March 2010

Scrip

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I recently entered the world of book swapping. For the uninitiated, these are websites that allow users to send and receive books with others without sending any money directly. The two major players, PaperBackSwap (bigger, but US only) and BookMooch, are quite similar. Basically, the user lists books s/he is willing to part with. The user receives a “credit” for sending requested books to others and pays a “credit” for getting a book from someone else. The shipper always pays postage. As the price of all books is equal and fixed (1 credit), I wondered about the possible effects of this “price controlling”. Unsurprisingly, there are longer waits for high-demand books (I’m 575 on one book’s waiting list). Although harder to determine, I would also expect there should be fewer people willing to supply high-demand books (alternative markets such as Amazon Used Books or “friends” providing higher value).

For the final effect, I must complete the description of these toy economies. PBS provides +2 credits for listing your first 10 available books and allows the purchase of additional credits ($3.45/credit). BM provides +0.2 credits per posted book and no possibility of purchasing credits (though intriguingly there is an unofficial bank that loans credits). My question to readers is whether inflation is possible on these sites? If so, under what situations would it manifest and what be its effects?

* – some other web sites do allow variable prices

Written by Brian Quistorff

March 9, 2010 at 8:30 pm

Posted in Uncategorized