Late last year, the world’s most expensive book – a beautifully-preserved copy of John James Audubon’s Birds of America – sold at Sotheby’s for £7.3 million, or around $10 million.
But that’s peanuts compared with the asking price on Amazon for an out-of-print but not particularly rare book on developmental biology. If you’re after a copy of The Making of a Fly: The Genetics of Animal Design by Peter A Lawrence, you could be looking at a cost of $23.6 million.
The reason? The algorithms used to set Amazon pricing by two internet merchants, “profnath” and “bordeebook”, as deduced by by UC Berkeley associate professor Michael Eisen. He was a trifle shocked, when a student attempted to pick up a copy of the book a few weeks ago, to see it listed at $1.7 million.
“At first I thought it was a joke – a graduate student with too much time on their hands. But there were TWO new copies for sale, each being offered for well over a million dollars,” he says.
“And the two sellers seemed not only legit, but fairly big time (over 8,000 and 125,000 ratings in the last year respectively). The prices looked random – suggesting they were set by a computer. But how did they get so out of whack?”
the next day, Eisen found that the prices had gone up – and worked out the pattern. Both companies were using a simple algorithm, pegging their own pricers to those of the other.
Once a day, profnath would attempt to marginally undercut bordeebook, setting its price at 0.9983 times its competitor’s. The prices would remain close for several hours – until bordeebook ‘noticed’ the change and set its own price to 1.270589 times profnath’s. This may have been because it didn’t actually posess a copy, and needed to build in a profit margin.
These two merchants are hardly likely to be the only players setting such algorithms – and similar pricing spirals could get even weirder if there are more than two players in the loop.
But one person who should be pretty pleased is the author himself. As Eisen points out, “Peter Lawrence can now comfortably boast that one of the biggest and most respected companies on Earth valued his great book at $23,698,655.93 (plus $3.99 shipping).
In the end, after the price peaked at over $23.6 million, someone appears to have noticed. A new seller, jasonpitt, now has it up for a slightly more affordable $158.90 – although bordeebook is still optimistically looking for $976.98.
Don’t worry, though: Amazon’s Buyback scheme will take it off your hands when you’re finished with it – for the princely sum of $2.34.