College Textbooks Prices have increased more than 1000 percent since 1900s

Going to College is expensive. Contributing to tuition fees, housing, travels is an enormous payment on textbooks. Public Interest Research Group found the average student spends as much as $1,200 each year on textbooks and supplies alone. College textbook prices are increasing way more than parents’ ability to pay for them. According to NBC’s review of Bureau of Labor Statistics (BLS) data, textbook prices have risen over three times the rate of inflation from January 1977 to June 2015, a 1,041 percent increase.

One of the reasons why publishers and bookstores keep raising prices is students are “captivate consumers”. As students have to buy books they are assigned, textbooks become necessities. Thus, with the change in the price of textbooks, the number of textbooks demanded varies very little. In other words, the price elasticity of textbooks is inelastic.

As a result, in order to avoid rocketing prices, students are renting books, buying cheaper digital versions instead of hardcovers or paperbacks, and taking advantage of free, “open source” textbooks. This shift in purchasing books changes the demand in other industries such as online banking and shipping. However, this still meant they have to spend hundreds of dollars on textbooks.textbookprice_d7bbb96677a81c69da37daa70391dc73.nbcnews-ux-600-700

Source: http://www.nbcnews.com/feature/freshman-year/college-textbook-prices-have-risen-812-percent-1978-n399926

1 Comment »

  1. Nicky Tynan Said,

    October 12, 2016 @ 1:44 am

    This is a clearly explained example of a good with a price inelastic demand once assigned. There is still competition within the market for textbooks but the competition is mostly on margins other than price. The partial response is that the quality of textbooks has increased over time (on margins students are believed to care about such as colorful illustrations) so you are paying more for a different product.

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