Closing the Book on Textbook Cost Inflation

Photo:
Ed Yevelev/Illustration



Related Articles »





  • Printer Friendly Printer Friendly
  • Comments Comments (0)

The prices of college textbooks rose by twice the rate of inflation between 1986 and 2004, according to the U.S. Government Accountability Office.

Students (and their parents) understandably are alarmed by that trend, which accompanies across-the-board increases in the out-of-pocket costs of attending college, including tuition charges, which have increased 240 percent in the past two decades.

Under mounting external pressure, the board that oversees Mississippi's eight public universities recently gave initial approval to policies that intend to control textbook cost inflation. Among other things, faculty members would be required to use the same edition of the texts they assign in lower-division undergraduate courses for three consecutive academic years, and for two years in their upper-division courses. Academic departments would be encouraged to adopt the same textbook for all sections of the same course and to make those adoption decisions earlier.

If only it were that simple!

Attempts to regulate the prices of any commodity, including textbooks, are bound to fail if they ignore the realities of the commercial marketplace.

The fundamental cause of ever-rising textbook prices is that authors and publishers earn income only on first-time sales. Once a new book is sold, it ends up in the second-hand market, after the buyer sells it back to the bookstore. The author and publisher do not benefit no matter how often a used book is resold. Profits from used textbook sales are earned only by college bookstores and the wholesalers who supply them.

The blunt fact is that the income streams of publishers and authors dry up about six months after publication.

Authors and publishers therefore have strong incentives to issue new editions, many of which incorporate only cosmetic changes-a new cover, a new layout or a few new applications. The market for the old edition is thereby eliminated (wholesalers will not pay anything for an out-of-print edition and the purchaser thus will be offered little or nothing for reselling it). When the new edition is published two or three years later, the author and publisher therefore can expect income from sales for the next six months or so, and the cycle begins anew.

Short timelines for revising and publishing new editions of existing textbooks are driven by the profit motive. That is the only way authors and publishers can justify the investments necessary to write, print and to market educational materials.

Students are asked (and are willing) to pay higher prices for new textbooks because they can resell them at semester's end. Used textbooks are worth less at resale, depending on the book's condition, which deteriorates over time. Planned obsolescence (cheap bindings and not very durable covers) is another predictable consequence of the economics of college textbook marketing.

What is to be done? One impractical option would be to ban sales of used textbooks, which would reduce the prices of new ones, since they then would have no value in the secondhand market. Another would be to create an institution for authors and publishers of textbooks similar to the American Society of Composers, Authors and Publishers, the clearinghouse for royalty payments to the composers, artists and publishers of music, which provides them with royalty income for performances of their work.

If the authors and publishers of college textbooks earned income on secondhand sales, there would be less incentive to issue new editions, the used-book market would flourish and prices would not rise so quickly. That objective is laudable but certainly will not be reached by regulatory fiat.

Tags: TEXTBOOKS


William F. Shughart II is a senior fellow at the Independent Institute and a University of Mississippi professor of economics. Reply to [email protected]



Comments (0) »

Comment Policy
The Daily Cal encourages readers to voice their opinions respectfully in regards to both the readers and writers of The Daily Californian. Comments are not pre-moderated, but may be removed if deemed to be in violation of this policy. Comments should remain on topic, concerning the article or blog post to which they are connected. Brevity is encouraged. Posting under a pseudonym is discouraged, but permitted. Click here to read the full comment policy.
White space
Left Arrow
Op-Eds
Image Professor Healey's denial of tenure is not right
As the semester comes to a close, our campus is quietly losing ...Read More»
Op-Eds
Image President Trump is a nightmare
So I'm sleeping peacefully one night until a dark thought pops into my mind...Read More»
Op-Eds
Image Koch money influences climate science
The threat of corporate funding influencing climate change research and pol...Read More»
Op-Eds
Image Bin Laden's death no reason to celebrate
Well, we've done it. We've killed the man who started it all. We've destroy...Read More»
Op-Eds
Image David Crane is unfit to serve as a member of the U...
The flattering article on David Crane that appe...Read More»
Op-Eds
Image I-House leadership is unfriendly to workers
I am one of a number of residents who requested and attended a forum at ...Read More»
Right Arrow




Job Postings

White Space