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The Logic Behind Giving Away Book Content

In the last two months I have released my two new books as completely free, no-strings-attached PDF versions. Here is my new book (co-authored with Carlos Lara) on the relationship between Austrian economics, fractional reserve banking, and Nelson Nash’s “infinite banking concept,” and here is my new economics principles textbook aimed at middle- and high-school students.

A lot of people went into shock when they found out that Carlos and I were making our PDF available online. (They weren’t as shocked by the principles textbook, since the Mises Institute–the publisher–has been posting free books for a while now.) After all, weren’t Carlos and I destroying book sales?!

I have two main responses to this understandable reaction. First, part of the reason Carlos and I wrote the book, is to teach Americans how the central banking system is systematically eroding the purchasing power of the dollar, as well as contributing to the boom-bust business cycle. The best way to get this important message out, is to make it available to anyone with an internet connection.

Second, I challenge the very premise that our policy will hurt us financially. In terms of total revenues, we need to consider that Carlos and I are both public speakers, who get a decent fee for giving an after-dinner talk or other such presentation. Blasting our free book all over the Internet is a good way to promote that aspect of our business.

Regarding the student textbook, I am using it for my online Mises Academy course (which starts in a few hours!). So distributing the free PDF to homeschooling blogs etc. was a great way to advertise for the online class. (And to repeat, even if a bunch of homeschoolers got to read the book for free, without signing up for my class, that’s not a “loss” in my book. I want my lessons to get into the hands of as many students as possible.)

Even if we limit ourselves to the narrow criterion of book sales, let’s think about it like an economist. It’s true, by making the PDF available for free download, there might be some people who otherwise would have purchased the book, but now won’t do so.

But how many people is this likely to be? Each of the books is quite long; it would be a real pain to print them out. So if someone is really that interested in the whole book, he or she is probably still going to buy the physical book.

On the other hand, by giving the PDF away, there are many, many more people who “sample” it, who would otherwise have never considered buying it. It’s true, the vast majority of these people won’t end up buying, but most of them wouldn’t have bought in any event. Yet there will be some people who buy because they were pleasantly surprised by what they found in the PDF.

Now it’s true, maybe the numbers wouldn’t work out for, say, the latest Stephen King novel. But for my latest two books–which have a lot of material packed into them, and which require multiple readings to fully master–I think the second group outweighs the first. In other words, I think on net more people will end up buying the books, because we have made the PDFs available for free.

Think of an actual bookstore: To take the “don’t give it away for free” logic to its extreme, bookstores should wrap every title in plastic, so that customers can’t browse in the store. After all, if you let people browse, why would they ever buy the book?!

The logic here is the same. By making the PDF available online, it’s analogous to Barnes & Noble allowing you to browse to your heart’s content in their store. Sure, cash-strapped college students might end up reading the latest Harry Potter on successive afternoons without actually buying it, but the customer base in general will end up buying more total books because of the option of browsing.

Creative people, embrace the wave of the future. Give your content away!

Robert P. Murphy has a PhD in economics from New York University. He is teaching a 10-week online class on the Principles of Economics.

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