Hidden Costs II

The second surprise of the return to college occurred when I bought my textbooks for the coming semester. As a side note, my very first semester in college, lo those many years ago, got off on the wrong foot when my parents and I arrived on campus at the last minute. By the time I was moved in and ready for the start of class, most of my textbooks were sold out. This was so disturbing that I was too embarrassed to go to some of my classes. I did not understand that I had other options. Thus were set the conditions for my early departure from that lovely bastion of Southern education. If I did not gain much from that first experience, I did learn the importance of buying textbooks as early as possible. Now that I am (I hope) a mostly fully realized adult, my compulsions are merely an extension of my personality. That is to say, I got to the college bookstore well in advance of the start of this semester.

I had, of course, seen the temporary booths spotted around the campus at semester-end. I knew that various bookstores were buying used textbooks from those students happy to be well rid of a particular subject and desperate for beer money. But I did not understand the economic model of the textbook industry.

I have a clearer understanding now. My textbook cost, for 5 low-level courses, was just under $400. That total does not include notebooks, a calculator for Mathematics courses ($140), pens, pencils, and a snappy messenger/book-bag to transport various books to and from different classrooms (okay, the bag was a Christmas present).

The prices are unconscionable. As I type this, sitting on my desk is a thin volume, “Chinese Religious Traditions”, which is the size of a 5 x 8 notecard, less than 125 pages in length, bought used, for $10. There are 5 such books for that one course. In algebra, according to the course syllabus, we will cover only about 40% of the book that cost me a cool $83, used. It was strongly suggested that I purchase the accompanying Solutions Manual (@ $33), which I did, only to find that the text has, in the back, the same answers as the solutions manual (only the odd numbers in both) . Could I return the solutions manual? “No, we only buy textbooks. I’m sorry“. Well, so am I. An English literature anthology that has been owned by at least three previous students, at least based on the different colored hi-liters, cost more than $100.

Today, as I enjoyed the luxury of a Saturday morning perusing my favorite web-sites, I discovered the root cause of the textbook valuation crisis. As always, an understanding of basic economics provides the answer. To wit:

one of the major causes of higher priced new textbooks is the used textbook market. For example, if the fixed cost of producing a textbook is $500,000 and 5,000 units of the book are sold each year for 4 years then each textbook would bear $25 of the fixed cost.

However, if, due to the used textbook market, only the first 5,000 units are sold and, in each of the remaining three years these same 5,000 units are sold as used textbooks, then the publisher still has the $500,000 in fixed costs spread out over only 5,000 books. Thus each new textbook bears $100 of fixed costs, resulting in higher retail prices for all textbooks. This example demonstrates what has been happening in the textbook market over the past several years: As the used textbook market has expanded so have the market prices of new and used textbooks.

Now there’s a revolutionary idea. Don’t buy the textbooks back, keep using the same edition until there is a significant change in the knowledge base, and the unit cost of the books will decrease.

To my admittedly cheap way of thinking, textbooks should have some value to the owner beyond the 3-month semester; after all, it used to be that way “way back when”. If the damn books don’t cost so much, they won’t have as much value in the “used” market. Then, maybe, my English anthology that is full of lovely poems might find a place in my bookcase. Perhaps it would provide a lifetime of enjoyment, providing insight for years beyond the classroom, and serving as a reminder of a joyous time in my life, especially since the three previous owners will not have had their chances to highlight every third line in various shades of pink, yellow, and green.


1 Response to “Hidden Costs II”

  1. 1 Mark Long May 13, 2008 at 2:22 pm

    You have my sympathy. I remember “way back when” I first went to a state college in Texas I could sign up for 18 hours AND buy all my textbooks for less than $500 a semester. Now I work at a state two-year technical college where students typically spend +500 a semester on textbooks alone, much less their tuition.

    Thankfully, our school tried something different to combat high textbook prices: they started an in-house textbook publishing division four years ago. I had been a college English teacher for about 10 years but I was lucky enough to move over to head that effort up.

    Sure, our books don’t have all the bells and whistles (many of which add little value to students or instructors but do have the valuable function to textbook publishers of reducing/negating resale value) . . . but they also typically have a price of $40-$60.

    Anyway, best of luck . . . and keep fighting the good fight!

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“Life’s hard, son. It’s harder when you’re stupid.” — The Duke.

Education is a companion which no misfortune can depress, no crime can destroy, no enemy can alienate,no despotism can enslave. At home, a friend, abroad, an introduction, in solitude a solace and in society an ornament.It chastens vice, it guides virtue, it gives at once grace and government to genius. Without it, what is man? A splendid slave, a reasoning savage. - Joseph Addison
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