In the context of self-publishing, what does it mean to order "author's copies"? Are they: A) offered for free, like they would be as part of a traditional publishing contract? B) Sold to you "at cost" of printing and shipping without any markup? C) Sold above cost but with a discount greater than or equal to size of the royalty? D) Sold above cost but with a discount smaller than the size of the royalty? E) Sold at full retail price but without any royalty?
I very much doubt A because then Amazon would basically be operating what amounts to a free vanity press. But maybe they'd throw in a couple as a perk.
I also doubt B because then they would be operating a revenue-neutral vanity press, but maybe it would still be worth it to them if they counted on gettong enough non-author sales to make enough margin to fund the operation.
I also doubt D or E, because if so, then why would anybody order "author's copies" of their book?. Just get your friend to order them for you and reimburse them and you'll come out ahead.
I would guess the answer is C. But in that case, it seems to me that you are getting implicit royalty on those "author's copies", but those royalties are baked into the discounted price rather than being distributed to you later. (I suppose this might also have advantageous tax implications for you on those implicit royalties, compared to the alternative where you just order normal copies and get your royalties later.) Am I wrong about this?