Cooking the books

Vestiges of protectionism hurt the students of today, writes Sam Murray.

Image: Tom Caswell, via Flickr.
Image: Tom Caswell, via Flickr.
Image: Tom Caswell, via Flickr.

Parallel Import Restrictions (PIRs) are government regulations ostensibly designed to protect copyright and trademarks. In reality, however, they protect distributors from competition and facilitate price-gouging, with students paying more as a result.

In technical terms, PIRs limit the importation of goods from overseas without the consent of the authorised local distributor. Due to the free-trade value of removing restrictions, Australia has over the past few decades stripped back these restrictions on most overseas products … except for books.

In order to protect Australian publishers from having their prices undercut by overseas competition (particularly from Asian distributors), Australian bookstores and suppliers are legally unable to import books if the Australian publisher refuses. This drives up the cost of books domestically due to a lack of competition. Besides making access to books more difficult, the prices flow on to bookstores. Unable to import cheaper books, they are forced to sell at prices unpalatable to local customers, driving them away (and, often, to overseas internet resellers).

The Australian Productivity Commission in 2009 produced a report on the book PIRs, and whole-heartedly recommended removing them. This was ignored by the Labor Government of the time, which argued that the government had a duty to protect Australian publishers (if not Australian consumers).

But the report, most interestingly, noted that English-language textbooks sold in Asia are generally half the Australian price, and that the removal of PIRs would almost certainly lead to a dramatic fall in price of textbooks as international publishers can now compete with domestic publishers for the small, but profitable Australian market of students. Of course, some subjects with a local context such as Law or Government might only have an Australian publisher and therefore not benefit, but subjects covering more general topics, like the sciences, engineering, medicine and economics, would have far cheaper textbooks available for students.

The purchasers of textbooks also have far less choice than usual consumers in a market system anyway. The Productivity Commission noted that students are often required to get a specific textbook as dictated by the unit coordinator, on pain of academic penalties (or at least inconvenience). Coordinators are concerned about the academic value of the textbook, not the price or affordability. Students, saddled by a lack of competition, are consequently unable to seek other, more competitively priced products. Forced to pay artificially high Australian prices, it’s no wonder that buying a semester worth of textbooks is a traumatic experience.

“Stop Parallel Import Restrictions” may not be the catchiest slogan in the world, but the reality of this well-meaning but fundamentally repressive trade restriction is that it disproportionately hurts low SES students, for whom even a few hundred dollars a semester can make a world of difference.