Electronics, the cost disease, and the operation of libraries

This article analyzes the prospects for costs of computerized operation of libraries relative to costs of more conventional operation. Conventional library operation is labor intensive and not readily amenable to cumulative increases in labor productivity. This helps to explain the rapid and cumulative rise in cost per volume and/or student served relative to the rise in the economy's price level during the earlier postwar period. Because the price of computer hardware has been falling at a spectacular rate, it has been expected that computerized operation of libraries would become increasingly inexpensive relative to conventional procedures. Yet the evidence indicates that such a differential has not materialized. It is shown why the costs of computerized operation should in fact not be expected to fall along with the price of computer hardware. The reason is that the very decline in computer hardware prices has increased the share of software and other labor‐intensive activities in the total budget of computer operation. The implications of this relationship for library operations are analyzed.