A few weeks ago a postdoc in my lab logged on to Amazon to buy the lab an extra copy of Peter Lawrence’s The Making of a Fly ... The book, published in 1992, is out of print. But Amazon listed 17 copies for sale: 15 used from $35.54, and 2 new from $1,730,045.91 (+$3.99 shipping).
More precisely, the two new books were on offer for $1,730,045.91 and $2,198,177.95. When he checked the next day, Eisen found that the prices had increased further. Intrigued, he kept checking everyday, and found that the two sellers kept hiking the price on a daily basis, until it went all the way up to over 23 million dollars!
As I amusedly watched the price rise every day, I learned that Amazon retailers are increasingly using algorithmic pricing (something Amazon itself does on a large scale), with a number of companies offering pricing algorithms/services to retailers. Both profnath and bordeebook were clearly using automatic pricing – employing algorithms that didn’t have a built-in sanity check on the prices they produced. But the two retailers were clearly employing different strategies.