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But Why Would Greg Mankiw Adopt?

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Timothy Taylor writes,

My solution is my own introductory textbook, "Principles of Economics." The second edition of this text is out this fall through Textbook Media, Inc. The pricing works this way: $17 for access to an online e-textbook which has search, notes, and chat options, but that can't be printed; $22 for the e-textbook along with the ability to print out PDF files of the chapters; and $33 for the e-textbook along with a black-and-white printed softcover version of the book. Textbook Media is a small company. It has no sales force to knock on the doors of professors and take them to lunch. It sponsors no junkets. The book is printed in black and white. But it does have e-textbook functionality, a workbook of problems and answers, a test bank, and some other add-ons. If you want a micro or a macro split, they are available. Of course, I think the content and exposition of the book is excellent on its own merits. But given the issue of soaring textbook prices, the price alone should make it worth a look.

I can see why students would have an incentive to adopt a cheaper textbook. But professors, and particularly professors who author competing textbooks, have no such incentive. And they are the ones who drive adoption.

Of course, comes the revolution, there won't be any need for textbooks. Which might be good for Taylor, who is the star of the Teaching Company videos of econ.

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COMMENTS (8 to date)
Joshua Macy writes:

I was just discussing this with my brother, who's a provost at a state university. The administration would like to shift to more e-books, because they're concerned about the prices the students are stuck with for texts, but they don't want to do the professors out of income from texts. They also currently have a policy that prevents the professors from assigning their own textbooks, to prevent self-dealing, and are worried that's reducing the incentive for professors to develop their own texts.

I proposed they offer the professors a deal through the university press: publish your text as an e-book, and they'll set the price at approximately what the professor would get as a royalty on a traditionally published book and pay 100% (or nearly) as the royalty. This is a better deal for the professors than it seems, because apparently the calculations for royalties on texts are complicated by buy-back programs, and a nominal royalty rate of, say, 10% almost never works out to that much once the accountants are done.

wintercow20 writes:

I teach about 600 undergraduate students across 6 classes and have done away entirely with textbooks. Our students spend on average $10 or so on books for the classes (e.g. they buy Hazlitt's Economics in One Lesson, which if they are savvy could also be had for "free").

My estimate is that this has saved in aggregate about $50k to $60k in net book purchases each year (many students buy new and then resell). No comment on what those savings are being directed toward. But my incentives to do this are perverse - it is certainly much more work for me to design the readings and course, the cost savings to the students do not redound to me, and the time commitment to maintaining and updating a high quality reading portfolio is orders of magnitude higher than relying on a text.*

BTW - about 5% to 10% of our students in intro end up purchasing the online access to Taylor as a back-up/reference. Two years ago it was available for free, with ads. Last year it was priced at $10 or so, and now it is up to $17.

(*) That came off as sounding way to whiny ... I don't mean it, seriously! I enjoy doing the class designs this way.

wintercow20 writes:

sorry for the typo above, it should have said "too" whiny

Blake writes:

I've sold textbooks, after-market on-line, for many years and so have no interest in seeing Prof. Taylor's innovations catch on. I have always believed that the book industry would die out entirely before textbooks. They will be the last to go because of the broken-market nature of textbooks.

As the professor above mentions, there is no incentive for him to reduce prices since he's not paying them. There is certainly no incentive since many professors are also authors, but that's really a second-order effect. Even teaching-school profs use pricey books because they're easier and often prestigious. Profs can shop entirely on quality, which usually means ease of use, comfort, and prestige, and stick students with the bill. As far as I can tell this system is a natural result of having a class share a textbook and even an ebook revolution won't change that much, in fact it might make it worse.

siredge writes:

It seems to me that as long as the universities have most of the power in the relationship with students / prospective students, there is little incentive to not give the professors what they want. But if for-profit private universities, free content on the internet, and other forces actually start to erode that power, then universities will probably make more forceful policy shifts toward electronic delivery of content to keep costs down and to provide a more attractive product to prospective students.

Of course, that assumes that the present lobbyists against for-profit universities don't manage to regulate them out of existence. But that's another issue...

Daublin writes:

Most of the posters are talking about big-name universities with price tags that, if we are honest, are shockingly high.

Going forward, it's not clear that's where most people will get their education. If you think about community colleges and online universities, the students have tremendous power to simply walk away or go to a competitor.

As such, I think we can guess which kind of institution will be the first adopters of mechanisms to make education more efficient.

Bill Conerly writes:

The college could bundle textbooks with tuition. Then the Dean would probably give each prof a book budget. It would be best if fungible: save money on books, get money for some other purpose.

Tim Layton writes:

A better solution is that offered by Boundless Learning. Boundless Learning is a company that outlines popular economics textbooks like Mankiw's and then goes to the internet to find open source information to explain the concepts in each section. They then employ PhD students to take the public information and synthesize it into easily an accessible (and free) online textbook that is mapped to the sections in the popular textbooks. That way a student who is told that on Tuesday they will be discussing section 5.4 of Mankiw's book can avoid purchasing Mankiw's book by reading the section mapped to Mankiw 5.4 in Boundless Learning's online text. Currently, there are only introductory texts for Econ, Psych, and Biology, but there are many more on the way. This way, Mankiw can choose to use whatever book he wants in class, and the students can avoid high textbook prices while still learning the material.

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