Bookshop owners make very little - Adam Smith explains why

Running a physical bookshop these days is not, as we all know, a path to great riches. In fact, it's more akin to working for something less than minimum wage. At which point we've two points we might want to make.

The first being that we do and should run the economy in the interests of consumers, not producers. If there is now some less costly, more efficient, manner of providing reading material to the people then we positively desire that that flourish. For that means we are being economic with our scarce resources and we can have both the reading and more of something else. 

The second being that we can work out why people do still run such bookshops:

When I last toured indie bookshops two years ago, there was ebullience at the peaking of Kindle sales and popular revulsion at Amazon’s tax arrangements. But no conventional economist could grasp how 900 indies are still in business. They are, because so much bookselling is done out of love. That’s wonderful, but the rest of us – and publishers producing special editions – must love them back.

Absolutely every conventional economist on the planet could and can explain that. Humans do not maximise income, they don't maximise cash, profits are not the be all and end all of life. We maximise utility. As Adam Smith pointed out those 241 years ago

THE five following are the principal circumstances which, so far as I have been able to observe, make up for a small pecuniary gain in some employments, and counterbalance a great one in others: first, the agreeableness or disagreeableness of the employments themselves; secondly, the easiness and cheapness, or the difficulty and expense of learning them; thirdly, the constancy or inconstancy of employment in them; fourthly, the small or great trust which must be reposed in those who exercise them; and, fifthly, the probability or improbability of success in them.

A substantial number of people find their utility maximised, even if not their incomes, by running bookshops. And why shouldn't people do what they find makes them happy? 

As we really must insist running a bookshop earns little money not despite people loving doing so but because.