GUEST COLUMNIST: Prevent bookstore monopoly

Michael Brus Michael Brus Is it just me, or does that skeleton of I-beams at 36th and Walnut streets look more and more like Sansom Common every day? Before you can say "Barnes & Noble," that steel frame will be filled with students reading, flirting and sipping latte inside the University's new bookstore. Not incidentally, they will buy lots and lots of books. On the face of it, this does not seem so bad. I usually favor increased competition, and if the Penn Book Center and House of our Own do not provide books efficiently, they deserve to perish, right? Wrong. First, if the Penn Book Center and House of our Own go under, Barnes & Noble will have a monopoly on University City. Needless to say, this will not save students money. But the debate is not just about money. I would argue that an intellectual community needs an academic bookstore, regardless of how many students flock to Barnes & Noble this fall. In other words, the University should spend money to cultivate something it values highly. It is within its place to do this. It does similar things all the time. First, consider that Penn is not just one economic agent among many. It is a monopolistic landlord with the power to influence the market. And it routinely exercises this power by currying favor with successful businesses to lure them to University City. To ingratiate itself with the owners of an "upscale" venue, like La Terrasse, Penn must induce them to set up shop in an area with high crime and a nine-month student population. I suspect that when it comes to these prized establishments, the University negotiates a "better-than-market" deal. In economic terms, the University internalizes the cost of its preference for "respectable" businesses into its rental price. This is a subsidy to private business, and it occurs all the time. It is what keeps Le Bus at the center of campus and University Pinball at the edge -- regardless of what University Pinball might be willing to pay to relocate. By playing the finicky landlord, Penn nudges the market in directions it desires. Generosity toward a Barnes & Noble competitor like Penn Book Center is not asking for too much. Just last year, Columbia University helped launch a world-class scholarly bookstore called Labyrinth. A private business which opened in April, Labyrinth is located across the street from campus. And it is doing splendidly, even in a fiercely competitive and high-rent market. This success is partly due to the store's excellent selection and use of sale pricing. As Cliff Simms, its co-owner, notes, "We provide a service that nobody else does -- to not only bring the books in, but have something to say about them." But Labyrinth would not have succeeded without the generosity of Columbia, which provided it with space at a "very good" rent price, Simms says. As a result, Columbia now enjoys an intimate, academic bookstore to supplement its "official" university one. Here's hoping Penn will lend such a helping hand.