Summary of why textbooks are expensive
Name: Marc Kevin Go
Principles of Macroeconomics: Extra Credit Assignment
Summary:
Four decades ago the text book prices and consumer prices in America increased at the same rate, but in the 1980’s the two went on separate different routes. Consumer prices grew around 3% a year which remains steady until today but textbook prices went up. By the year 2014, the price increased around 3 times the rate of other prices. The 812% increase in the price of college textbooks since 1978 makes the run-up in house prices, and at the same time textbook prices also dwarfs the increase in the cost of medical services over the last three decades. Compared to the 250% increase in the Consumer Price Index (CPI) over the last 34 years, college textbooks have raised more than three times the amount of the average increase for all goods and services.
One of the many factors affecting this rate change is labor which demands charging high prices and the cost of marginal production. There are also underlying factors such as professors assigning students to course books regardless of cost and often assign ones they have written to earn them royalties. Publishers also bundle textbooks with software forcing students to buy new editions instead of cheaper used copies to further boost their profit.
Explanation and how it relates to the Subject topic: The graph above tells us that the price of textbooks have risen more than the amount of average for goods and services. At some point in the year 1970’s books started to get expensive. Publishers capitalized on professors’ willingness to adapt new editions of a book every two or three years. Textbooks became less about educating the masses and more about exclusivity and profitability. As we can see in the 1990s, the textbook market is shared by small number of producers or sellers, thus prices skyrocketed. That is however not the only reason as to why it has increased that much. In the Chapter we have talked about, we discussed
Principles of Macroeconomics: Extra Credit Assignment
Summary:
Four decades ago the text book prices and consumer prices in America increased at the same rate, but in the 1980’s the two went on separate different routes. Consumer prices grew around 3% a year which remains steady until today but textbook prices went up. By the year 2014, the price increased around 3 times the rate of other prices. The 812% increase in the price of college textbooks since 1978 makes the run-up in house prices, and at the same time textbook prices also dwarfs the increase in the cost of medical services over the last three decades. Compared to the 250% increase in the Consumer Price Index (CPI) over the last 34 years, college textbooks have raised more than three times the amount of the average increase for all goods and services.
One of the many factors affecting this rate change is labor which demands charging high prices and the cost of marginal production. There are also underlying factors such as professors assigning students to course books regardless of cost and often assign ones they have written to earn them royalties. Publishers also bundle textbooks with software forcing students to buy new editions instead of cheaper used copies to further boost their profit.
Explanation and how it relates to the Subject topic: The graph above tells us that the price of textbooks have risen more than the amount of average for goods and services. At some point in the year 1970’s books started to get expensive. Publishers capitalized on professors’ willingness to adapt new editions of a book every two or three years. Textbooks became less about educating the masses and more about exclusivity and profitability. As we can see in the 1990s, the textbook market is shared by small number of producers or sellers, thus prices skyrocketed. That is however not the only reason as to why it has increased that much. In the Chapter we have talked about, we discussed