Estimating the demand for library service: Theory and practice

Issues related to the demand for library service are not new to library administrators and other information scientists. However, formal economic analysis of that demand is just beginning. This paper has two objectives: to explain the theoretical links between the demand for library service and key economic variables and to describe how demand was estimated in one specific experimental context: the demand for library service of institutional users of the Cleveland Health Sciences Library. This study is cited to illustrate some problems that are likely to arise in attempting to estimate statistically the parameters of library demand functions. The need for more precise economic analysis of library demand has grown as forms of information that have traditionally been provided free to users begin to acquire explicit price tags. This trend is likely to continue. Most economic models for setting library user fees require specific inputs about the demand for information and the sensitivity of demand to changes in economic variables. Even in situations where user fees are not applicable, an understanding of the demand function can be useful in predicting how the amount of library service demanded might change if underlying economic or noneconomic variables change. As more complete data become available, economic analysis of library demand will be employed more frequently as a policymaking tool.