Money for Nothing
I actually used to write book arbitrage software, and this person has managed to completely misunderstand it.<p>I'm not arguing here for its societal value, just that dan appears to have misunderstood some fundamental bits about how it works.<p>> Robot 1 offers Book A for $10. It probably doesn't have it in stock, but it knows where it can buy it for, say, $9, drop-ship it to the customer without ever seeing the acutal product, and make a buck on the arbitrage. Robot 2 notices this and lists the same book for $11, hoping to do the same thing. Robot 1 notices Robot 2's listing, doesn't know or care that Robot 2 is another arbitrage trader, and reprices its listing for the book to $12. Robot 2 notices this and goes to $13, and away we go.<p>This makes no sense; the fundamental rule of amazon bots is that consumers buying used books almost always buy the <i>lowest-priced</i> used book available. So the bot war would send the price <i>down</i>, not up.<p>Why in the world would bot 2 offer the book for $11? It would know that nobody would buy it when there was one already listed for $10.<p>The silly-high-priced books that I saw when I was working for the book company were rare long-tail books. One of the discoveries that many people have made is that for rare books, whether or not you understand what the heck it is, some % of them will get bought even if they're listed for <i>silly</i> high prices. Enough people will pay thousands of dollars (not an exaggeration) for a used copy of a book that they can't find elsewhere that stocking the long tail of books can in fact be very valuable.<p>That means that, when you find lots of rare books, your incentive is to throw out some crazy-high price for each, because some % of them will, in fact, get paid, making the whole enterprise worthwhile.<p>edit: Arbitrage on the same market Does Not Work, in my experience, and to just claim that it does with no evidence doesn't make it any more likely to do so.