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Open Access, Counter-Revolutions, and Market Structures

Schmal’s (2024) article, La Révolution Dévore ses Enfants: Pricing Implications of Transformative Agreements, offers a rigorous theoretical exploration of how transformative agreements (TAs) in academic publishing affect pricing dynamics, market power, and ultimately the competitive landscape of scholarly publishing. By modeling the “publish‐and‐read” (PAR) fee—which integrates the costs for both publishing articles and accessing a publisher’s portfolio—the paper demonstrates that legacy publishers can leverage their extensive stock of paywalled journals to secure high revenues, even as overall publication numbers decline. This mechanism, described as the “must stock” problem, not only preserves incumbent profit margins but may also erect significant barriers to entry for fully Open Access competitors.

From an economic perspective, the paper is particularly insightful. Schmal (2024) derives a model in which the PAR fee is decomposed into a “publish” component and a “read” component, with the weighting between them adjusting according to the number of TA publications. The analysis shows that when publication demand is high, the fee is driven by the increasing cost of securing additional journal space (π(N)); conversely, when demand falls below a threshold, publishers switch to emphasizing the value of their existing repository (ρ). This dual structure allows TA publishers to “insure” themselves against declining submissions and extract rents from libraries’ fixed budgets, thereby maintaining a dominant market position. Such findings resonate with earlier work on academic publishing oligopolies (Larivière et al., 2015; McCabe & Snyder, 2004) and extend the discussion by quantifying the potential anti-competitive effects inherent in TA design (Bergstrom et al., 2014; Haucap et al., 2021).

Although Schmal’s analysis is primarily economic, the article carries further important implications. Culturally, the paper’s title—referencing Jacques Mallet du Pan’s famous observation that “the revolution devours its children”—evokes the paradox that the very instruments designed to democratize access to scholarly knowledge (i.e., TAs facilitating open access) may inadvertently reinforce established hierarchies. In this sense, the transformation of the publishing landscape carries a cultural cost: it risks perpetuating a system in which market power and entrenched reputational advantages continue to shape academic communication, despite the ostensible goals of Open Science (Laakso & Björk, 2016; Nye, 2017).

From the policy perspective, the study underscores the power asymmetries between academic institutions and large commercial publishers. TAs are negotiated under conditions of fixed library budgets, and as Schmal (2024) shows, the structure of these agreements can force universities into a “must stock” dilemma. This scenario implies that political and institutional negotiations—often influenced by reputational and bureaucratic factors—tend to favor incumbent publishers. In this way, transformative agreements serve as a policy tool that may limit the emergence of alternative publishing models, thereby reinforcing the political economy of academic publishing (Aghion & Bolton, 1987; Rothfritz et al., 2024).

Socially, the implications are profound. The persistence of high pricing under TAs not only strains library budgets but also limits broader public access to scholarly research. As the academic community increasingly values transparency and equitable access to knowledge (Bjørk, 2017; Butler et al., 2023), Schmal’s findings suggest that the current trajectory of TAs may hinder rather than help the Open Access movement. The model predicts that unless TA contracts are redesigned to lower barriers to entry for fully Open Access publishers, the social benefits of a truly open scholarly communication system may remain elusive.

In connecting Schmal’s work with the broader scholarly literature, one sees that the article contributes to ongoing debates about the economics of Open Access. While earlier studies (e.g., McCabe et al., 2013; Bergstrom, 2001) have documented the monopolistic tendencies in academic publishing, Schmal (2024) advances this discussion by offering a formal model that captures the dynamic response of publisher pricing to changes in publication behavior under TAs. His analysis also echoes concerns raised by Shu and Larivière (2024) regarding the “knowledge tax” imposed on researchers and institutions, thereby situating the paper within a critical tradition that questions the transformative potential of current open access policies.

In sum, Schmal’s (2024) article is a significant contribution that bridges economic theory with practical policy concerns in academic publishing. By revealing how the design of transformative agreements can, paradoxically, perpetuate the market dominance of legacy publishers, the paper invites scholars, policymakers, and academic institutions to reconsider how open access transformation is negotiated and implemented. The study calls for a rethinking of contract design to foster greater competition and truly democratize access to scholarly knowledge.

References

Aghion, P., & Bolton, P. (1987). Contracts as a barrier to entry. The American Economic Review, 77(3), 388–401.

Armstrong, M. (2015). Opening access to research. The Economic Journal, 125(586), F1–F30.

Bergstrom, T. C. (2001). Free labor for costly journals? Journal of Economic Perspectives, 15(4), 183–198.

Bergstrom, T. C., Courant, P. N., McAfee, R. P., & Williams, M. A. (2014). Evaluating big deal journal bundles. Proceedings of the National Academy of Sciences, 111(26), 9425–9430.

Bjørk, B.-C. (2017). Growth of hybrid open access, 2009–2016. PeerJ, 5, e3878.

Butler, L.-A., Matthias, L., Simard, M.-A., Mongeon, P., & Haustein, S. (2023). The oligopoly’s shift to open access: How the big five academic publishers profit from article processing charges. Quantitative Science Studies, 4(4), 778–799.

Dewatripont, M., Ginsburgh, V., Legros, P., & Walckiers, A. (2007). Pricing of scientific journals and market power. Journal of the European Economic Association, 5(2–3), 400–410.

Haucap, J., Moshgbar, N., & Schmal, W. B. (2021). The impact of the German ‘DEAL’ on competition in the academic publishing market. Managerial and Decision Economics, 42(8), 2027–2049.

Laakso, M., & Björk, B.-C. (2016). Hybrid open access—A longitudinal study. Journal of Informetrics, 10(4), 919–932.

Larivière, V., Haustein, S., & Mongeon, P. (2015). The oligopoly of academic publishers in the digital era. PLOS ONE, 10(6), e0127502.

McCabe, M. J., & Snyder, C. M. (2004). The economics of open-access journals. Working Paper 193, George J. Stigler Center for the Study of the Economy and the State, University of Chicago.

McCabe, M. J., & Snyder, C. M. (2005). Open access and academic journal quality. American Economic Review, 95(2), 453–458.

McCabe, M. J., Snyder, C. M., & Fagin, A. (2013). Open access versus traditional journal pricing: Using a simple “platform market” model to understand which will win (and which should). Journal of Academic Librarianship, 39(1), 11–19.

Puehringer, S., Rath, J., & Griesebner, T. (2021). The political economy of academic publishing: On the commodification of a public good. PLOS ONE, 16(6), e0253226.

Rothfritz, L., Herb, U., & Schmal, W. B. (2024). Trapped in transformative agreements? A multifaceted analysis of >1,000 contracts. (Manuscript submitted for publication).

Schmal, W. B. (2024). La Révolution Dévore ses Enfants: Pricing Implications of Transformative Agreements. arXiv:2403.03597v2. https://doi.org/10.48550/arXiv.2403.03597

Shu, F., & Larivière, V. (2024). The oligopoly of open access publishing. Scientometrics, 129, 519–536.

Waldfogel, J. (2017). How digitization has created a golden age of music, movies, books, and television. Journal of Economic Perspectives, 31(3), 195–214.

 

[Edited by Pablo Markin. The initial draft has been generated using ChatGPT, OpenAI (February 14, 2025).]


OpenEdition suggests that you cite this post as follows:
Pablo Markin (February 14, 2025). Open Access, Counter-Revolutions, and Market Structures. Open Access Blog. Retrieved March 24, 2025 from https://doi.org/10.58079/13bm9


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