As we all know by now, the price of our college textbooks is a significant part of our schooling costs and seems to have gotten worse even in the last 5 years. Although I have since resorted to other channels of distribution, I was always completely shocked as a freshman and sophomore when the bookstore cashier announced my total. No offense to textbook authors, but how in the world are the publishers charging me $200 for a book that will be obsolete in one year, or even one semester. Even if production costs have risen significantly, this alone would not account for the astronomical prices publishers are charging.
According to the article in Business Week titled, “Textbooks for Tightwads” the textbook publishing industry is an Oligopoly, with 5 major publishers running the show. There might not be outright collusion between the companies, but their objectives are no mystery. Because there is a defined market that requires a unique product, the publishers can introduce higher prices and have little or no consequences when it comes to market share or revenue.
I’m sure I’m not the only one who gets frustrated when I see brand new textbooks on the shelves wrapped in cellophane with a “CD-ROM” that I know I’ll never use. With a few publishers controlling the market, they also have the ability to offer “bundled” products at higher costs, even if consumers would prefer the products separately.
When an oligopoly controls an industry, the consumers receive less surplus, if any; and the producers are motivated by profit, not by quality. Competition equalizes the market and promotes a free-market economy where producers are motivated to make their products better and where consumers are driven to find the best deal.
3 comments:
I agree that the price of textbooks exceed the cost of producing them. The quality of the text is important though. Teachers and professors will read the material and if they don't like what they read they won’t order any books. On the other hand if they like the quality they will order hundreds to meet the demand for the number of students.
I'm confused that the only difference between one text book one year, and the newer addition the next year is just the year. In many of my classes, the text books have been the same material word for word other than the page numbers. I believe that a lot of teachers usually just prefer certain writers and stick with them year after year. Professor Tufte, I'm curious on how you determine how you choose the text book you teach from? Because of the demand, they can get away with adding the cd and raising the price.
Do any of you know of any textbook publishers that are making a lot of profit? Or textbook authors who have made a lot of their books? If you don't, then the high price probably reflects high costs not high profits.
Why are costs so high? There are bunch of reasons. Obsolescence is a factor in some fields. Licensing of images is a big cost in many fields. Typesetting is a big cost anywhere there are formulas. Tables and charts cost a lot of money too.
Another huge factor though is size of the market. Publishers need to make their money on what is often a small market - so they aren't at the bottom of their average cost curve. If you look, there are books that have lower prices because they have been through enough editions to cover costs.
Chase: a big factor for me (before I try the book on students) is the quality and size of the test bank. I can be a lot more flexible with exams, homeworks, and due dates if I can generate decent question sets quickly. Once I try the book on the students, the big factor in keeping it is student boredom. If they feel it is a tough read, then I'll usually switch.
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