The publisher that paid Arthur James, a popular novelist, a $2 million advance on his recent novel, which sold only 42 copies, fell victim to:

Question

The publisher that paid Arthur James, a popular novelist, a $2 million advance on his recent novel, which sold only 42 copies, fell victim to:​

Quizplus · Accepted Answer

The situation described here is an example of the winner's curse, where the publisher paid a high advance to Arthur James assuming that the novel would be successful, but it turned out to be a complete failure. The publisher may have overestimated the value of the novel, leading to a situation where they paid too much for the rights to the book. This is a common problem in auctions and other settings where bidders may compete to acquire an asset or investment.

The Publisher That Paid Arthur James, a Popular Novelist, a $2