That was the sign posted at the Co-op bookshop here at Monash Caulfield.
Now as a co-author of one of Australia’s largest selling (and best) first year undergraduate economics textbooks, the second hand book market has always been a concern. New editions sell well the first year and then sales tend to drop rapidly as the second-hand market takes over. Rental clearly kills the second-hand market but replaces it with a rental market.
At first glance this seems neutral to the author. With a second-hand market the book is sold once (with royalties) then resold second-hand (without royalties) until it falls to pieces or is replaced by a new edition.
With rental, the book is sold once with royalties, then rented out until it falls to pieces or is replaced by a new edition.
However, I suspect book rental will lower overall sales of new textbooks and lower returns to hard working and deserving textbook authors. The rental agreement require that the book is returned in good condition by a fixed date. So it will definitely be returned to the rental pool (unlike the situation where selling the second-hand book has a transactions cost that dissuades some students) and is likely to be kept in good condition (students don’t want to pay the fine for returning a book in poor condition).
Of course this may mean that authors will respond by putting out new editions more often to try and undermine the rental market.
However, what really annoyed me was that the bookshop was renting a first year microeconomics textbook – but it wasn’t Gans, King and Mankiw!