Friday, August 26, 2011

Sky-High Textbook Prices--And My Suggested Solution for Intro Economics

High textbook prices are modest problem in the context of soaring costs of higher education, but many of the costs of tuition and room and board are more-or-less concealed from many students, while textbook costs are in their faces and their pocketbooks. According to a recent short story in the Chronicle of Higher Education, 7 in 10 Students Have Skipped Buying a Textbook Because of Its Cost, Survey Finds."  The article refers to a survey done by the U.S. Public Interest Research Group of 1,905 students at a range of 13 campuses. "Separate analyses from the U.S. Public Interest Research Group have found that textbook costs are typically comparable to 26 percent of tuition at state universities and 72 percent of tuition at community colleges."

This evidence basically confirms what has been found by other groups. Back in May 2007, the Advisory Committee on Student Financial Assistance, which produces reports for the U.S. Department of Education,  published “Turn the Page:  Making College Textbooks More Affordable.” Some comments from that report:
  • “Annual per student expenditures on textbooks can easily approach $700 to $1,000 today."
  • "Nearly all the components of college expenses outpaced the CPI from 1987 to 2004 for both two-year and four-year public colleges.. . . Textbook expenses rose far more rapidly than the prices of other commodities nationwide: 107% at two-year public colleges and  109% at four-year public colleges, compared to 65% for the CPI.”
  • “Even after accounting for total grant aid, textbooks and other learning materials appear to be unaffordable for students from low- and moderate-income families at both two- and four-year public colleges.”
  • “Students today see the traditional textbook for many undergraduate courses as a disposable resource, not a long-term reference book, in part because frequent edition updates can render it obsolete quickly, and the digital era has changed attitudes toward the nature of printed material.”
In July 2005, the GAO published a report called College Textbooks: Enhanced Offerings Appear to Drive Recent Price Increases" (GAO-05-806). Some comments from the report:

  • “Increasing at an average of 6 percent per year, textbook prices nearly tripled from December 1986 to December 2004, while tuition and fees increased by 240 percent and overall inflation was 72 percent."
  • "While many factors affect textbook pricing, the increasing costs associated with developing products designed to accompany textbooks, such as CD-ROMs and other instructional supplements, best explain price increases in recent years."
  • "U.S. college textbook prices may exceed prices in other countries because prices reflect market conditions found in each country, such as the willingness and ability of students to purchase the textbook."

Economics textbooks are not exempt from these trends, of course. Take a look at prices for the best-selling and best-known introductory economics textbooks. A copy of the full-year, micro and macro version will typically list at more than $200, although students can often get discounted copies at sellers like for about $170-$180.

My solution is my own introductory textbook, "Principles of Economics." The second edition of this text is out this fall through Textbook Media, Inc. The pricing works this way: $17 for access to an online e-textbook which has search, notes, and chat options, but that can't be printed; $22 for the e-textbook along with the ability to print out PDF files of the chapters; and $33 for the e-textbook along with a black-and-white printed softcover version of the book.  Textbook Media is a small company. It has no sales force to knock on the doors of professors and take them to lunch. It sponsors no junkets. The book is printed in black and white. But it does have e-textbook functionality, a workbook of problems and answers, a test bank, and some other add-ons. If you want a micro or a macro split, they are available. Of course, I think the content and exposition of the book is excellent on its own merits. But given the issue of soaring textbook prices, the price alone should make it worth a look.

ADDED: Arnold Kling at Econlog responds with a tough-minded comment about college faculty in a post titled "But Why Would Greg Mankiw Adopt?": "I can see why students would have an incentive to adopt a cheaper textbook. But professors, and particularly professors who author competing textbooks, have no such incentive. And they are the ones who drive adoption."