High Price of Textbooks: Problem Analysis

16 Apr

For many college students and their families, buying expensive textbooks is one of the most stressful events of year. According to Liz Weston, personal-finance columnist for MSN Money, between the 2010 and 2011 academic year, the average full-time college student spends about $534 on textbooks each year. This current sum actually decreased from the 2005-2006 academic year which was estimated to be around $632 at that time. This is because local bookstores and publishing companies offer more available options for students such as book rentals, e-books, etc.  Liz Weston also stated that 49% of students actually buy new books, 38% buy used books, 10% rent books, and only 2% buy e-books. The new textbook customers are mostly freshmen because they do not realize there are other options such as purchasing used book or rentals. According to a survey done by U.S. Public Interest Research Group, seven in ten college students said that they intentionally did not buy a at least one textbook because of the expensive price.

 

Then why are textbooks so expensive and make students afraid to purchase them? The cost of the books is determined by many variables. First of all, about 20% of the money earned goes to pay the store to cover miscellaneous expenses. About 15.4 cents of every dollar of textbook costs goes to marketing the textbook, 11.7 cents goes to the author and about 32.2 cents goes to actually making the book including the supplies needed.James Koch is an economic professors at Old Dominion University, and he believes textbook prices will not go down without university professors’ cooperations. He believes that many professors do not pay too much attention on how their textbook considerations will influence over students. Also, universities tend to earn more from their bookstore contracts when students are spending more on textbooks, so they do not help control prices.  Another economic professor at Michigan State University, Byron Brown believes publishers and authors have monopoly power and marketing strategies such as marginally improved new editions of textbooks. New editions of textbooks are put out approximately every 3.9 years, and most professors require the newer version of textbook even if there are not many changes. Also, e-books are not the best option for both publishers and authors because compared to traditional textbooks, e-books have no value for resale.

 

There were several previous attempts to reduce textbook costs. In 2010, New York Times reported that publishers started to unbundle textbooks so students can separately purchase workbooks or CDs at a lower price. Recently, the government  regulates textbook publishers to inform the university faculty about how much their textbooks actually cost, so the professors understand how much students will pay when they buy them. Also publishers must provide additional information of revision histories and a list of alternative formats. However, these attempts have been insignificant in helping to reduce the price of textbooks. Dr. Koch said many professors do not care too  much about the costs of textbooks, so they do not spend much time reading publisher’s provided information. Also, there are no direct financial disadvantages or regulations for publishers and authors to sell expensive textbooks. Many students voluntarily seek for alternative ways to buy cheaper textbooks. According to the survey done by Liz Weston, 61% of students compare prices online before they make an actual purchase. It is estimated that buying textbooks from Amazon saves money from 20 to 40% of their total cost. Another option could be to rent textbooks from various websites such as Chegg.com. It is estimated that students can save up to 50% on the rented books, however average rental websites only offer about 25% of required texts students need for classes. Students understand there are cheaper textbooks available online, but they do not often  purchase them them because of delivery issues, financial privacy, etc.

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