First, the easy part: e-readers are replacements for books, and most manufacturers deliberately make their e-readers resemble books. Most of the e-reader manufacturers assume that customers want to continue the same "look and feel" so they create e-readers that are the same sizes as books.
Now for the more interesting part: how is the size of books determined? Carl Pyrdum provides the answers in his Got Medieval blog at http://gotmedieval.blogspot.com/2010/08/why-are-books-so-big-google-penance.html
You must remember that the earliest books were not printed on paper. In medieval days, they were printed on parchment. What is parchment? Sheep's skin. You remember when you graduated from college you got the ol' sheepskin? That's because the diploma was supposedly printed on parchment, although many colleges stopped that practice years ago.
Some of the early books were also printed on vellum, which is essentially the same thing except that it is made from calfskin.
In the good ol' days, the maximum size of a book was determined by the size of the sheep or the calf when slaughtered. Actually, that was quite large, typically bigger than any book you would want to hold while reading. The monks who created books before Gutenberg's invention of the printing press soon learned to fold the parchment and vellum into practical sizes:
- Fold a sheet of parchment once (two leaves/four pages per sheet) for a folio; if you fold sheets of paper once without a cover, you’ve got a tabloid.
- Fold twice for a quarto (8 pages/sheet), the size of a big dictionary or big laptop.
- Fold three times for an octavo (16 pages/sheet), a hardcover or Kindle DX.
- Fold four times for a duodecimo (24 pages/sheet), a trade paperback/iPad.
- Fold four times (in a slightly different way) for a 16mo, a mass-market paperback/e-reader.
- Fold five times for a 32mo, a notepad/old-school smartphone sized.
- Fold six times for a 64mo, or as Erasmus called it, a Codex Nano (rarely seen but could be called a vest pocket book).