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Scalping's a good example of how markets break down for what we want as a society. Most of us have a visceral reaction to scalpers because we want to live in a
by Frondo 9y ago
Scalping's a good example of how markets break down for what we want as a society. Most of us have a visceral reaction to scalpers because we want to live in a world where music and shows are a cultural experience more of us can share.
Scalpers don't do that--they don't open up that experience--they insert themselves in between the real transaction, making some bank for themselves while adding no value to either party's experience.
I'm sure you could say "but scalpers help determine the real price of the ticket, to someone willing to pay" ... we, as a society, don't want or need that help. If we, as a society, keep coming up with ways to thwart that (like the NiN thing mentioned above), that's a sign.
Markets serve us at our leisure, not the other way around.
- maxerickson 9y agoIt's tautological that scalpers are providing value to the people they sell tickets to (otherwise there would not be scalpers). People react to it because it violates ideas about fairness.
- castis 9y agoThe value here is entry to an event. The scalper does not create this value. Their service degrades this value in the form of a higher cost. The end user pays this because there are usually no other options. It's greedy reselling.
- maxerickson 9y agoThe value the scalper provides can still be analogous to transporting some goods across a distance. They act as a middleman that changes the availability of the thing they sell. I'm not arguing in favor of scalping, I'm just saying that the good arguments against are about fairness, they aren't economic. For instance, there is always the option of not attending a concert. This is not the same things as "no other options".
- castis 9y ago> The value the scalper provides can still be analogous to transporting some goods across a distance Sure, can be, but isn't. More often than not, it's moving the point of sale from one website to another with an absurd markup. If it's a scalper on the sidewalk selling tickets to a sold out show, then yes, they've physically moved the asset but created no more value to either the venue or the end user, only to themselves, so we're still talking about greed. > For instance, there is always the option of not attending a concert. This is not the same things as "no other options". The end user not going to the concert because of the ticket price means that the scalper has imposed that choice on the user.
- maxerickson 9y agoYou've missed my meaning. I said analogous, not literally the same. The scalper changes availability of tickets from favoring time/chance to favoring willingness to pay more. It's also a bit much to talk about the scalper imposing anything on end users. If everyone got together and stopped buying scalped tickets, there wouldn't be any ticket scalping anymore. Except that won't work because there are plenty of people that care less about money and ticket scalping than they care about attending concerts.
- castis 9y agoJust because the end user doesn't mind paying higher, doesn't mean a higher price has not been imposed on them.
- zzalpha 9y agoIt's not imposed. Look, a scalper wouldn't command the prices they did if the demand wasn't there. In reality, whether we like it or not, the scalper is actually facilitating price discovery. It's very clear that these tickets are worth more to people than their face value, as otherwise the scalpers would be unsuccessful. All the scalper is doing is raising the price to what the market will bear. Which is why this isn't about economics. It really is strictly about fairness, which is entirely orthogonal.
- saosebastiao 9y agoAnd at the price the artist set, more people want to get into the event than can be accommodated. Couldn't we also say that those that buy scalped tickets are greedy? Because they are willing to use their wealth to outbid those that are less wealthy in order to partake in a scarce cultural experience?
- castis 9y ago> Couldn't we also say that those that buy scalped tickets are greedy? No, they were most likely going regardless of the ticket price, they are just less deterred by it.
- saosebastiao 9y agoTheir purchase of the ticket and subsequent attendance literally means that someone else couldn't attend. They, by virtue of wealth, took that experience from someone else.
- castis 9y agoNot sure if you missed the entire rest of the thread, but we're talking about the scalpers. The event attendee in your scenario would have gone with or without the scalpers existence.
- saosebastiao 9y agoThe same number of attendees would have attended. Whether they would be the same attendees is entirely disputed. They absolutely would be different. The person who could afford a ticket at face value and no more cannot attend because greedier people were willing to pay more to displace them.
- castis 9y agoWatching you try and justify greedy behavior is almost as impressive as it is pathetic.
- and0 9y agoIt's pure rent seeking, it creates no value except for much wealthier people who don't want to remember when tickets go on sale.
- saosebastiao 9y agoCan you imagine what the world would be like if we had to remember a sale date for a specific airline flight? We'd probably all end up buying from scalpers, the airlines would get screwed out of lots of money, and we'd all be pissed that we'd be buying from greedy no-value middlemen. But from a qualitative and quantitative customer perspective, it probably wouldn't be much different from the way it is now with dynamic pricing...the only difference is the airline makes less money and the scalper would capture the difference. Artists are the problem in this market. They should charge more (which eliminates the incentive to scalp), or play more shows (increasing the supply and lowering market prices) if they don't want to charge more.
- and0 9y agoFlights and concerts are entirely different industries, so this is a silly comparison. These issues don't have perfect Econ 101 answers. Artists can't just play more shows as touring is pretty demanding, and charging more means only wealthier people can attend which (rightfully) looks bad and is a legit moral issue.
- saosebastiao 9y agoArtists can and do play more. Phish in particular is pretty famous for doing multiple shows in the same venue on contiguous nights, as well as doing smaller shows in smaller towns in between larger cities as a way of spreading out demand. And their prices have always been pretty reasonable as a result. More artists should care about their fans enough to do this, but I guess it's easier to just blame greedy scalpers for the ticket prices.