Everyone who owns an e-reader has wondered about this at some point. Nathan Bransford breaks it down.

THE GIRL WHO KICKED THE HORNET'S NEST is selling on Amazon for:

E-book: $11.99
Hardcover: $11.89

Doesn't make sense, right?

Well, here's how that breaks down between publisher and Amazon:

E-book: $11.99
Publisher: $8.39 (70% of e-book price)
Amazon: $3.60 (30% of e-book price)

Hardcover: $11.89
Publisher: $13.95 (50% of $27.95 list price)
Amazon: - $2.06 (customer price minus $13.95 paid to publisher)

So... unless there's some sort of special arrangement there, Amazon is using the hardcover as a loss leader.

And the publisher would tell you: we can't control that. All we can do is set our own prices, and what Amazon charges the consumer for print books is their business. Publishers make more money on the hardcover sale, they set the list price for the hardcover at $27.95 and the e-book at $11.99, and they don't have much incentive to discount the e-book any further than it already is.

Read the whole post, it's worthwhile.