9 ms·

> Scalpers hurt literally everyone. Not entirely true, and also not accepting that one person's "scalper" is another person's "bought this but decided I would

> Scalpers hurt literally everyone. Not entirely true, and also not accepting that one person's "scalper" is another person's "bought this but decided I would rather have the money it seems to be worth now that I see how much this is". Secondary markets provide liquidity, allow for original sellers to trade money for time, provide reputational protection based on societal perceptions (this one is a bit weird, and maybe the less defensible of the reasons. Selling your own inventory on a secondary market to avoid negative press for high prices is thwarting normal market information principles, IMO), etc.

__blockcipher__ 5y ago
Yeah I always find it interesting that statements like that ("scalpers hurt literally everyone") can just be made and treated as gospel by most people. Not only is the statement not self-evident, but to your point, just a small amount of thought on the issue makes it obvious what the value is. People love to get mad at a scapegoat rather than a root cause. So you blame the scalper rather than realizing that the concert you bought the ticket for set their prices way too low - perhaps because selling at the "true" price (somewhere between the sticker value and the scalped value) - would generate negative goodwill, or it would give the perception that an event (say Coachella as the classic example) is only "for rich people". The irony is of course that selling at an artificially low price doesn't suddenly make it not for rich people, it just adds a small random chance that you'll be able to convert your own time sitting there refreshing the website across many browsers into a cheaper-than-it-should-be ticket. But functionally the vast majority of people end up buying from scalpers or at least at a slightly above sticker price. There's a related discussion about so-called "price gouging". IMO it's the classic scalper argument but just in a different form. Price gouging laws are not just immoral but are actively ineffective at their stated purpose; they just lead to the hypothetical price-gouge transaction never occurring. If you drive across state lines to bring HAM radios or water filters or what-have-you during hurricane katrina, and try to sell at above market rate, you'll be tossed in jail and your goods will be seized by the police, rather than making it out to the people who actually need them and are willing to pay 2x or 3x the usual price. TL;DR: We've all got these twisted beliefs about how pricing works or the law of supply and demand, an illusion supported by the fact that our respective societies are so technologically/economically advanced that we can have massive supermarkets where you buy commoditized items that you can get at reasonably similar prices anywhere. Whereas if you go back in history to a pre-industrial time, a form of pseudo-bartering was the default and there was not this idea of a commodity, but rather every transaction, every buyer:seller relationship etc was a unique and non-commoditized interaction and thus it wouldn't seem weird to have different prices for different people or different prices at different points in time, etc.
- andechs 5y ago
  > moral but are actively ineffective at their stated purpose; they just lead to the hypothetical price-gouge transaction never occurring. If you drive across state lines to bring HAM radios or water filters or what-have-you during hurricane katrina, and try to sell at above market rate, you'll be tossed in jail and your goods will be seized by the police, rather than making it out to the people who actually need them and are willing to pay 2x or 3x the usual price. The reason is they don't want private individuals entering danger zones just to make a buck - a profiteer could easily end up a victim from the dangerous situation.
  - jtbayly 5y ago
    So now emergency workers aren’t allowed to be paid. Congrats.
    - Fuzzwah 5y ago
      What? "emergency workers" are not "private individuals".
      - jtbayly 5y ago
        The reasoning against private citizens was that taking risk to make money was inappropriate. That applies equally to emergency workers. And by the way, many workers during emergencies are just private citizens.
- lazide 5y ago
  Do you have any data on that ‘majority of people buy from scalpers’ claim? One reason for anti price gouging laws is that it is not uncommon for people to buy out all supply, then turn around and charge more/sit on a stockpile to solve the artificially created shortage they themselves created - a term for that being ‘cornering the market’. I haven’t generally seen too much anger at someone legitimately opening up supply by importing more or opening up more supply lines (especially if they say that’s what they’re doing). People have been pretty open to paying more in that case (albeit maybe not 10x more, though that is more because it’s hard to plausibly have such an increase in cost without literally airdropping supplies - which is a different beast).
Dylan16807 5y ago
> Not entirely true, and also not accepting that one person's "scalper" is another person's "bought this but decided I would rather have the money it seems to be worth now that I see how much this is". Even just dropping resales to one GPU per person per year would make an enormous difference, let alone if it was limited to people that genuinely bought the one GPU for themselves.
- kbenson 5y ago
  It doesn't work. It's unenforceable without the government to enforce it, and even then people will skirt it. Rules constraining how a market functions often don't work or have unintended consequences. The only real solution is to attack supply and/or demand. A rule limiting how many a person can buy doesn't actually affect demand, it just affects that market's ability to respond to demand. You get people that circumvent that, and if it's onerous enough you'll get a secondary market where they cost more but there's no limit on the amount you can buy, if there wasn't one already. That is, it's restrictions on a free market which create secondary markets. If the price was constantly in flux base don demand, there would be no secondary market because it would provide nothing over the primary one. People don't want that though, because we've been conditioned over the last century to expect prices to be stable because we've had large companies that decided to innovate and compete in other areas that decided pricing things accurately based on real world local conditions. I mean, I understand, I'm the same way. I don't want to walk into a store and find the thing I went to buy is twice as expensive as it was yesterday. I do think that's a more natural and sustainable state though, as long as market principles are actually prioritized though, instead of just being paid lip service (having one entity control a large chunk of a market is bad, and so is making it hard to reason about items and features in a market, as competition and information are the life-blood of free-markets).
  - Dylan16807 5y ago
    > It doesn't work. It's unenforceable without the government to enforce it, and even then people will skirt it. Okay, but when I said "dropping" I wasn't talking about a rule, I was using that to demonstrate the problem. > A rule limiting how many a person can buy doesn't actually affect demand, it just affects that market's ability to respond to demand. There's a nearly fixed supply, because no amount of demand can affect the shortages. There's a nearly fixed demand, because enough of the cards are going to be sold at MSRP to keep stoking it. In a situation like that, someone arbitraging the prices is not helping supply and demand meet, they're just making a profit. You want some amount of secondary market so that the people that very badly need a card can pay extra to get one now. But a tiny percent of cards going onto ebay is enough to fulfill that role. If half the cards end up massively marked up on ebay, it doesn't help allocate them more efficiently in any significant way, it just takes more money from people.
scoopertrooper 5y ago
> Not entirely true, and also not accepting that one person's "scalper" is another person's "bought this but decided I would rather have the money it seems to be worth now that I see how much this is". That’s a bit of a straw man, literally no one considers that scalping. It’s generally understood to mean buying more of scarce product than you could ever possibly need with the intent to sell it at a massive markup. Scalpers are parasitic rent seekers in the digital age. They do nothing to improve the logistics or liquidity of markets. They merely seek to monopolise supply to extract profit from consumers for a product they did not produce.
- kbenson 5y ago
  > That’s a bit of a straw man, literally no one considers that scalping. It’s generally understood to mean buying more of scarce product than you could ever possibly need with the intent to sell it at a massive markup. That is by no means the accepted definition, nor an apt description. I know people that bought two PS3's when they came out in 2006, one to play, one to sell. That is generally accepted as "scalping", but they were not buying more than they could ever possibly need. Many, many people that participate in the resale market are people acting like this. They buy tickets for themselves and some extra ones while they're at it because they were lucky enough to by available at the right time and/or get lucky. Sometimes they also do it for the occassional event or good they don't plan to use. These are "scalpers" in every single single sense of the word, and the only difference between them and someone that makes a business out of it is scale. > Scalpers are parasitic rent seekers in the digital age. They do nothing to improve the logistics or liquidity of markets. They merely seek to monopolise supply to extract profit from consumers for a product they did not produce. Scalpers are just brokers that work in a different product. They make money by arbitrage, where the primary sales market is underselling a good compared to the secondary sales market. Additionally, they provide accurate market pricing because people responsible in the primary market don't want to for whatever reason (common ones includes upsetting ones fans, it being more work, harder to work out contract payments, etc). And lest you think it's easy to just point at scalpers/brokers and at all the money they make because they're selling a $50 ticket for $200, consider that those are the extreme cases, and relatively few tickets go for that. There's also many tickets that go under cost. In the same event. By significant amounts. It's not uncommon to get tickets for 20% cheaper on stubhub. In some cases, when brokers have bought tickets and the event didn't sell out, you can find tickets for single digit dollars that went for $40+ originally. I've talked about this before here.[1] In that example, I pointed to the market conditions for a specific event at that exact moment, where the primary market (TicketMaster) wasn't sold out and charging $39.50, TicketMaster's own secondary market was charging $36.50 for the same tickets, and Stubhub was charging $27. Who reaps the benefit of getting tickets for more than a 25% discount? Who do you think ended up paying for that? Where do you think the funds came from to pay for that? (here's a hint, you need to make an occasional 200%-300% profit in that business to break even over the long run in a lot of cases) Here's another question, why and how is this different than the stock market, and in the ways it's different, how does it matter to the perspective you're expressing? 1: https://news.ycombinator.com/item?id=18027560 https://news.ycombinator.com/item?id=18027560

__blockcipher__ 5y ago

Yeah I always find it interesting that statements like that ("scalpers hurt literally everyone") can just be made and treated as gospel by most people. Not only is the statement not self-evident, but to your point, just a small amount of thought on the issue makes it obvious what the value is. People love to get mad at a scapegoat rather than a root cause. So you blame the scalper rather than realizing that the concert you bought the ticket for set their prices way too low - perhaps because selling at the "true" price (somewhere between the sticker value and the scalped value) - would generate negative goodwill, or it would give the perception that an event (say Coachella as the classic example) is only "for rich people". The irony is of course that selling at an artificially low price doesn't suddenly make it not for rich people, it just adds a small random chance that you'll be able to convert your own time sitting there refreshing the website across many browsers into a cheaper-than-it-should-be ticket. But functionally the vast majority of people end up buying from scalpers or at least at a slightly above sticker price. There's a related discussion about so-called "price gouging". IMO it's the classic scalper argument but just in a different form. Price gouging laws are not just immoral but are actively ineffective at their stated purpose; they just lead to the hypothetical price-gouge transaction never occurring. If you drive across state lines to bring HAM radios or water filters or what-have-you during hurricane katrina, and try to sell at above market rate, you'll be tossed in jail and your goods will be seized by the police, rather than making it out to the people who actually need them and are willing to pay 2x or 3x the usual price. TL;DR: We've all got these twisted beliefs about how pricing works or the law of supply and demand, an illusion supported by the fact that our respective societies are so technologically/economically advanced that we can have massive supermarkets where you buy commoditized items that you can get at reasonably similar prices anywhere. Whereas if you go back in history to a pre-industrial time, a form of pseudo-bartering was the default and there was not this idea of a commodity, but rather every transaction, every buyer:seller relationship etc was a unique and non-commoditized interaction and thus it wouldn't seem weird to have different prices for different people or different prices at different points in time, etc.

andechs 5y ago
> moral but are actively ineffective at their stated purpose; they just lead to the hypothetical price-gouge transaction never occurring. If you drive across state lines to bring HAM radios or water filters or what-have-you during hurricane katrina, and try to sell at above market rate, you'll be tossed in jail and your goods will be seized by the police, rather than making it out to the people who actually need them and are willing to pay 2x or 3x the usual price. The reason is they don't want private individuals entering danger zones just to make a buck - a profiteer could easily end up a victim from the dangerous situation.
- jtbayly 5y ago
  So now emergency workers aren’t allowed to be paid. Congrats.
  - Fuzzwah 5y ago
    What? "emergency workers" are not "private individuals".
    - jtbayly 5y ago
      The reasoning against private citizens was that taking risk to make money was inappropriate. That applies equally to emergency workers. And by the way, many workers during emergencies are just private citizens.
lazide 5y ago
Do you have any data on that ‘majority of people buy from scalpers’ claim? One reason for anti price gouging laws is that it is not uncommon for people to buy out all supply, then turn around and charge more/sit on a stockpile to solve the artificially created shortage they themselves created - a term for that being ‘cornering the market’. I haven’t generally seen too much anger at someone legitimately opening up supply by importing more or opening up more supply lines (especially if they say that’s what they’re doing). People have been pretty open to paying more in that case (albeit maybe not 10x more, though that is more because it’s hard to plausibly have such an increase in cost without literally airdropping supplies - which is a different beast).

Dylan16807 5y ago

> Not entirely true, and also not accepting that one person's "scalper" is another person's "bought this but decided I would rather have the money it seems to be worth now that I see how much this is". Even just dropping resales to one GPU per person per year would make an enormous difference, let alone if it was limited to people that genuinely bought the one GPU for themselves.

kbenson 5y ago
It doesn't work. It's unenforceable without the government to enforce it, and even then people will skirt it. Rules constraining how a market functions often don't work or have unintended consequences. The only real solution is to attack supply and/or demand. A rule limiting how many a person can buy doesn't actually affect demand, it just affects that market's ability to respond to demand. You get people that circumvent that, and if it's onerous enough you'll get a secondary market where they cost more but there's no limit on the amount you can buy, if there wasn't one already. That is, it's restrictions on a free market which create secondary markets. If the price was constantly in flux base don demand, there would be no secondary market because it would provide nothing over the primary one. People don't want that though, because we've been conditioned over the last century to expect prices to be stable because we've had large companies that decided to innovate and compete in other areas that decided pricing things accurately based on real world local conditions. I mean, I understand, I'm the same way. I don't want to walk into a store and find the thing I went to buy is twice as expensive as it was yesterday. I do think that's a more natural and sustainable state though, as long as market principles are actually prioritized though, instead of just being paid lip service (having one entity control a large chunk of a market is bad, and so is making it hard to reason about items and features in a market, as competition and information are the life-blood of free-markets).
- Dylan16807 5y ago
  > It doesn't work. It's unenforceable without the government to enforce it, and even then people will skirt it. Okay, but when I said "dropping" I wasn't talking about a rule, I was using that to demonstrate the problem. > A rule limiting how many a person can buy doesn't actually affect demand, it just affects that market's ability to respond to demand. There's a nearly fixed supply, because no amount of demand can affect the shortages. There's a nearly fixed demand, because enough of the cards are going to be sold at MSRP to keep stoking it. In a situation like that, someone arbitraging the prices is not helping supply and demand meet, they're just making a profit. You want some amount of secondary market so that the people that very badly need a card can pay extra to get one now. But a tiny percent of cards going onto ebay is enough to fulfill that role. If half the cards end up massively marked up on ebay, it doesn't help allocate them more efficiently in any significant way, it just takes more money from people.

scoopertrooper 5y ago

> Not entirely true, and also not accepting that one person's "scalper" is another person's "bought this but decided I would rather have the money it seems to be worth now that I see how much this is". That’s a bit of a straw man, literally no one considers that scalping. It’s generally understood to mean buying more of scarce product than you could ever possibly need with the intent to sell it at a massive markup. Scalpers are parasitic rent seekers in the digital age. They do nothing to improve the logistics or liquidity of markets. They merely seek to monopolise supply to extract profit from consumers for a product they did not produce.

kbenson 5y ago
> That’s a bit of a straw man, literally no one considers that scalping. It’s generally understood to mean buying more of scarce product than you could ever possibly need with the intent to sell it at a massive markup. That is by no means the accepted definition, nor an apt description. I know people that bought two PS3's when they came out in 2006, one to play, one to sell. That is generally accepted as "scalping", but they were not buying more than they could ever possibly need. Many, many people that participate in the resale market are people acting like this. They buy tickets for themselves and some extra ones while they're at it because they were lucky enough to by available at the right time and/or get lucky. Sometimes they also do it for the occassional event or good they don't plan to use. These are "scalpers" in every single single sense of the word, and the only difference between them and someone that makes a business out of it is scale. > Scalpers are parasitic rent seekers in the digital age. They do nothing to improve the logistics or liquidity of markets. They merely seek to monopolise supply to extract profit from consumers for a product they did not produce. Scalpers are just brokers that work in a different product. They make money by arbitrage, where the primary sales market is underselling a good compared to the secondary sales market. Additionally, they provide accurate market pricing because people responsible in the primary market don't want to for whatever reason (common ones includes upsetting ones fans, it being more work, harder to work out contract payments, etc). And lest you think it's easy to just point at scalpers/brokers and at all the money they make because they're selling a $50 ticket for $200, consider that those are the extreme cases, and relatively few tickets go for that. There's also many tickets that go under cost. In the same event. By significant amounts. It's not uncommon to get tickets for 20% cheaper on stubhub. In some cases, when brokers have bought tickets and the event didn't sell out, you can find tickets for single digit dollars that went for $40+ originally. I've talked about this before here.[1] In that example, I pointed to the market conditions for a specific event at that exact moment, where the primary market (TicketMaster) wasn't sold out and charging $39.50, TicketMaster's own secondary market was charging $36.50 for the same tickets, and Stubhub was charging $27. Who reaps the benefit of getting tickets for more than a 25% discount? Who do you think ended up paying for that? Where do you think the funds came from to pay for that? (here's a hint, you need to make an occasional 200%-300% profit in that business to break even over the long run in a lot of cases) Here's another question, why and how is this different than the stock market, and in the ways it's different, how does it matter to the perspective you're expressing? 1: https://news.ycombinator.com/item?id=18027560 https://news.ycombinator.com/item?id=18027560