Why Are Textbooks So Expensive?

Everyone knows that textbooks are expensive. Students spend an average of $900 a year on textbooks, which is 20% of tuition at an average university and half of tuition at a community college! And the prices keep going up. Textbook prices have increased at four times the rate of inflation since 1994!

But why are textbooks so expensive and what can be done about it? We've done a lot of research over the last few years, and here's what we've discovered:

The Textbooks Market is Broken
 - The economics of the textbooks market give publishers a disproportionate amount of power to charge exhorbitant prices.  Since the people who select textbooks (faculty) are not the consumers (students), textbook sales are not responsive to the price students are willing to pay.  This allows publishers to get away with practices that would be unheard of in normal markets.

Unnecessary New Editions Make Used Books Disappear and Force Students to Pay More - Want to know why it's so hard to find used books? Because publishers constantly produce new editions of textbooks every 3 and a half years - even in fields like calculus and into physics that haven't changed significantly in years. Once a new edition is put out, faculty and the bookstore have no choice but to stop using the old edition. But that's not all. When publishers issue a new edition, they also jack up the price. This means not only can you not find a cheaper used book, but you have to pay more than ever!

Extra CD-ROMs and Workbooks Drive Up Prices and Make Books Harder to Resell - All that extra stuff that gets shrink-wrapped to the textbook make textbooks 10% to 50% more expensive. Bundles can also make it harder to sell back your books, because a lot of bookstores can't buy back the book if the CD-ROM is missing or if the workbook or web passcode is used.

Publishers Keep Professors in the Dark About Prices - After driving used books off the market and packaging in expensive extras, publishers don't even tell professors how much textbooks cost!  77% of professors we surveyed said publishers "rarely" or "never" volunteered textbook prices.  That means some professors do not have the opportunity to consider the cost to students.

Things are Starting to Change

On July 31st 2008, Congress passed significant legislation to lower the cost of textbooks for students.  The Higher Education Opportunity Act mandates that publishers tell professors textbook prices, that they sell textbooks unbundled from all of the extra workbooks and CD-ROMs, and that schools tell students which books are required before the start of classes. 

New Competition is Entering The Scene
A new company called Flat World Knowledge publishes "open textbooks" - books that are free online and affordable to buy in print.  In fact, there are many open textbooks that are written by professors who allow students to use them for free and print copies for a small cost.  For example, Introduction to Economic Analysis by the famous economist Preston McAfee is free online at www.introecon.com and $11.10 printed as a book - that's compared to $169.95 for a similar book!

Professors are Switching to Open Textbooks
Last spring, Iowa PIRG helped organize over 1,000 professors to sign a statement to give preference to open textbooks whenever they are academically appropriate. Now we are seeing more and more professors make the switch.  Introduction to Economic Analysis is used at Harvard and NYU, and another open textbook in math is used at Colorado State University and Smith College.  This is the sign of a promising trend that could bring more affordable books onto the market. 

What More Should Be Done?

We've made a lot of progress, but we still have a long way to go.  Bottom line, we think that textbooks should be reasonably priced, students should be able to easily sell their books and used books should be easy to find. Here is what we think publishers, faculty and universities should do to make this happen:

• Publishers should keep the cost of producing their books as low as possible without sacrificing educational content.
• Publishers should keep textbook editions on the market as long as possible without sacrificing the educational content.
  
• Publishers should give preference to paper or online supplements over producing entirely new editions.
• Publishers should always allow professors to order unbundled textbooks.
• Publishers should clearly and proactively disclose all of their products, prices and length of time they will be on the market.
• Publishers should pass on any cost-savings from digital books to students.
• Faculty should give preference to the least expensive textbooks whenever academically appropriate, considering both the up-front price and the price after selling it back to the bookstore.
• Faculty should consider switching to an open textbook instead of an expensive traditional textbook when the educational content is comparable.
• Faculty should follow cost-reducing guidelines when selecting textbooks, such as avoiding customizations, bundles, online-only books and turning book orders in on time.
• Colleges and Universities should consider rental programs such as those as several universities in Wisconsin and Illinois and encourage students to consider using online bookswaps.
• Colleges and Universities should provide support to faculty who want to use open textbooks and participate in efforts to develop more high-quality open textbooks.
• Colleges and Universities should provide students their list of required textbooks as early as possible.