For a college student the prospect of buying a semester’s worth of textbooks has become a terrifying thought. Students are being hit with skyrocketing costs for textbooks, but what is causing this dramatic price increase? Texts.com, a comparative market that buys and sells textbooks, is trying answer the question of rising textbook prices. Texts.com notes, “the average price of a college textbook has gone up 812% since 1978, and has doubled in the last decade alone.” The reason for this is the growing market for shared textbooks.
The internet has transformed how students buy and share books. In response, the leading textbook producers that control 80% of the print market (Cengage, Pearson, and McGraw-Hill) have come up with new earnings strategies: raise prices and reduce the buyer’s decision making ability. With a flood of new editions that reflect only cosmetic changes and online one-time access code textbooks, these producers have put a stranglehold on the market and can force prices up despite little change in demand.
Then there is the “Principal Agent Problem,” where the person making decisions about what has to be bought isn’t the person doing the buying. The professors are the ones deciding what books are needed for a specific course but the student is forced to fall in line and buy the required texts at their own cost. The blame isn’t completely on professors, as many are often don’t know kept in the dark about the price of the books they are asking their students to purchase. As long as the leading textbook producers have an oligopoly on the textbook print market, they will continue to drive up prices at the cost of the students.
Students, however, can still find cheaper options on sites like Texts.com. With Texts.com’s peer-to-peer textbook marketplace and price-comparison tool that shows students where to get the best deals online, more competition should only alleviate some of the frustration among students over the soaring costs of textbooks.
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