The Racket

Alain Bourget, a math professor at Cal State Fullerton, is in danger of serious disciplinary action from his employer. His crime? Refusing to teach the assigned textbook, which costs $180 and was co-written by the chair and vice-chair of his academic department. According to the Register, the mathematics department decided way back in 1984 to "approve" the text and hasn't revisited its decision since. Bourget wanted to use two other textbooks instead — one of which costs $76, and the other of which was free. Maybe there are other underlying complications that the Register hasn't reported — but the story reinforces a strong basic message. College textbooks are a racket.

Here's how the racket works: I teach international relations [..] Every year I do this, I get free textbooks during the summer from academic publishers who want me to assign them. I get phone calls and e-mails from publishers' reps, asking if they can come around and talk to me about all the great books that they have on offer. Occasionally, publishers contact me to see if I've any interest in writing a textbook myself [..] College textbook publishers charge vast and extortionate amounts for their textbooks for one simple reason. They do it because they can. Students usually have to take a few required big courses for their major, and they have to buy the required textbooks for these courses.

This means that the market is price insensitive (which is economic jargon for saying that demand doesn't go down as much as it should when prices go up). Professors often don't care as much as they should about the costs of the textbooks — after all, they don't have to pay those costs themselves. Students do usually care, but they don't have any choice in the matter — they have to buy the textbooks they are required to buy. Businesses can make big, big profits from selling to price-insensitive markets, since they can jack up prices without weakening demand for their product. It's a sweet deal for academic publishers, but not so great for students.