Plan S and the Economics of Scientific Journal Publishing

Abstract

Securing open access to research will not remove the fundamental problem that commercial publishers have substantial market power. Thus, even if Plan S is successful, large commercial publishers are likely to put financial pressure on universities and funders in the future. One underlying source of publishers’ market power is the hierarchical ordering of journals’ quality. Whether one likes it or not, such rankings are likely to arise as a response to asymmetric information. Plan S does not, and probably cannot, address the substantial information problems in research publishing. In the absence of journal hierarchies, other and more malign responses may easily arise, including discrimination along dimensions such as gender, age, personal networks, and the prestige of institutional affiliations. Paywalls and subscription requirements are currently tools publishers use to exercise their market power. However, the underlying reason for publishers’ market power is not this tool, but rather the fact that journals provide services that cannot, at least from the point of view of individual researchers, be easily replaced by the services of other journals. This will prevail even with open access. Rather than imposing very strict requirements on journals’ business models, we would encourage funders to collaborate with academies and professional organizations. These organizations have the professional credibility to establish new but still highly regarded journals if needed. Funders can fully finance such journals, presumably at a reasonable cost, making subscription fees as well as publication fees redundant. It is well-established in economics that, if so-called market failures are present, unregulated markets will not function efficiently. In scientific publishing, market failures abound. Below, we discuss some of them and their interplay, before concluding with respect to implications for the scientific publishing market, for the potential success of Plan S, and alternative approaches.