Hugh Howey, author of the runaway self-published best-seller Wool, has a very well-argued, thoughtful, and fascinating look at the relative merits of self-publishing for a median kind of writer, who is not a bestseller and only looks for a supplement to a regular income:
There are two possibilities. Your book might be in the top 1 percent of what readers are looking for — whether by the magic of your plot or the grace of your prose — in which case you are far better off self-publishing. You'll make more money sooner, and you'll own the rights when it comes time to negotiate with publishers (if you even care to). If, on the other hand, your work isn't in the top 1 percent, it won't escape the clutches of the slush pile. Your only hope in this case is to self-publish. Which means there isn't a scenario in which I would recommend an author begin his or her career with a traditional publisher. Not a one. Even Jim Carrey is going the self-pub route with his children's book, and he'll make a mint because of it. The new top-down approach is to self-publish and retain ownership. The course of last resort would be to sign away your rights for the rest of your life.
Louis C.K. proved this for comedy. The better you are, the better it pays to produce and own your own work. If you're not on that level, producing it yourself is the only option. Only option or best option. It's that simple.
"But I only want to write," you might say. "I don't want to be a publisher." Well, good luck. Even if you land with a major publishing house, the success of your work will depend on you knowing this business and embracing all the challenges that a self-published author faces. There are only a handful of authors in the world who can make a living writing and passing along those words to someone else and not doing a single other thing. Most people who attempt this method teach creative writing for a living, and not because they want to. Promotion will be up to you. Your publisher will want to see your social media presence before they offer you a book deal. Learning the ins and outs of self-publishing before signing with a major house is the best training imaginable. Not doing so would be like a hopeful race car driver not caring what's under the hood. I've been shocked to discover, having worked with major publishers, that many of my self-published friends know more about the current publishing landscape than industry veterans with decades of experience. The more you learn and the more you keep an open mind, the better your chances for success.