Jacoby Sheds Light on Amazon Business Model

Professor of Public Policy Sanford Jacoby was featured in a Capital & Main article about how Amazon’s business model has hindered unionization efforts by the company’s workers. “The thing you have to remember about Amazon is that it’s really two companies these days,” said Jacoby, author of the recently published “Labor in the Age of Finance: Pensions, Politics, and Corporations from Deindustrialization to Dodd-Frank.” “There’s the Amazon we know as consumers and then there’s Amazon Web Services, which is a much more profitable part of the company.” He explained that AWS, which sells data storage and processing to companies and generated $13.5 billion in 2020, is more profitable than the division where consumers buy items online and have them delivered. Jacoby noted that Amazon uses revenue from AWS to subsidize low prices for consumers and fast delivery, which increases the pressure on warehouse workers to meet the high demand. 

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