Quarterly Journal of Economics Vol. 124 No. 4 2009
Are Durable Goods Consumers Forward-Looking? Evidence from College Textbooks*
Abstract
We test whether textbook consumers are forward-looking, using a large new data set on textbooks sold in college bookstores during the ten semesters from 1997 to 2001. The data strongly support the hypothesis that students are forward-looking with low short-run discount rates and that they behave as if they have rational expectations of publishers' revision behavior. Data from a second new data set on the market prices of used books at Amazon Marketplace also support the hypothesis of rational, forward-looking behavior. Simulation results indicate that students are sufficiently forward-looking that publishers cannot consistently raise revenue by accelerating current revision cycles.
- DOI
- 10.1162/qjec.2009.124.4.1853
- Volume
- 124
- Issue
- 4
- Pages
- 1853-1884
- Language
- en
- Sources
- bibtex:phds-export.bib openalex crossref