Exit and Voice in Scholarly Publishing. Joshua Gans Draft: 15th December 2013

"These cases have in common a boycott that simply withdraws services for existing for-profit journals. However, in this paper, I evaluate whether a boycott is the correct response given that much of past knowledge remains under the control of for-profit publishers. For this I construct the frame the problem relying on Albert O. Hirschman’s distinction between exit (akin to the boycotts enacted) and voice (that I will argue is akin to negotiating within the system).

A vexing issue for economists is how to think about the discipline of power. As stressed by Hirschman, the tendency is to place weight on the discipline of the market; specifically, the withdrawal of services. This is the so-called exit option. When a consumer is dissatisfied with goods and services, they take their business elsewhere. When an employee is satisfied with their wages and working conditions, they move to another position. If this happens often enough or by someone important enough, change might occur. Either the organisation changes or it ceases to be. But, in reality, the use of exit as a discipline device can itself be weak. In effect, it depends on the power of the individual in an individual-organisation coalition. If the alternative options open to individuals are themselves poor, then even if they are able to choose to exit, they have no incentive to do so. To Hirschman, an alternative to exit was voice — or in modern markets, complaints. This arises when individuals express their dissatisfaction by raising a voice to issues while continuing to remain with or to purchase from an organisation. Voice had its own problems. First of all, it was costly to the individuals. Second, it may be vacuous if it could not be backed up with some sort of power. This may be the power to exit (in which case voice is not substitute) but it could be the power of voice to cause other problems that harm the decision-makers in an organisation. But when exit options were poor, voice could be an effective residual...."