> Libraries are part of a balancing act between spreading knowledge and keeping incentives for writing books high enough that people actually do it.

Not by design. Libraries are a way of keeping and organizing books for the interested to read them. Any function they provide to the publishing industry is incidental, in that readers are more likely to become writers. But no part of the mission of most libraries is to support the publishing industry. The history of libraries has been to defend themselves from the publishing industry, which historically has always fought to have them shut down.