Posted on 12/10/2009 8:04:37 PM PST by sickoflibs
Dozens of people among the throngs of jubilant fans hold crudely made cardboard signs featuring the words "I Need Tickets." Strangely, these people who, to an outsider, appear to be in desperate need of tickets for the big game, hold numerous tickets high above their head so everyone can see. These people are the noble ticket scalpers.
They are a people scorned by athletic organizations, lawmakers, and many fans. What are they doing to merit such ill will and legal persecution? Are they truly unscrupulous, greedy parasites who dupe fans and injure the athletic organizations?
The United States does not have a federal prohibition on ticket scalping, but many states and even more municipalities have restrictions or outright prohibitions. This is very unfortunate for everyone attending events in such areas because the ticket scalpers are real public servants. The laws, to the degree that they are enforced, are actually responsible for the majority of the unfavorable things attributed to the practice of scalping.
Scalpers provide a myriad of services and benefits to a surprisingly large, and seemingly disconnected, group of individuals, businesses, and organizations. Surely, they deserve praise rather than scorn and persecution.
One of the first beneficiaries of the Scalper's services are the athletic organizations themselves. This may seem surprising, since many event organizers go to great lengths to discourage fans from purchasing from scalpers. Scalpers enable the teams to presell tickets much more effectively. This is because scalpers are willing to purchase tickets in advance in the hope of being able to hold them for some period, and then resell them for a profit.
In contrast, many people are unsure, at the time of presale, if they will be able to take off from work or other obligations. This uncertainty leads people to abstain from purchasing until they are certain they will be able to attend. Thus, the ticket scalper enables the team to get their money earlier through ticket presales.
Scalpers absorb the time risk associated with events. They absorb the risk associated with scheduling issues (i.e., whether or not fans can attend). They also absorb the risk that unfavorable events could occur. Anyone who has ever bought or sold a ticket knows that ticket resale values drop dramatically after a team has a few losses on its record. If the team does well, the scalper can make a nice profit; if the team does poorly, he can suffer a huge loss.
This opportunity for profit is good for fans because it ensures that tickets will be made available should the team do unexpectedly well. It is good for the team because it will be able to presell tickets even for bad seasons. The more the local law enforcement cracks down on scalpers, the greater the reduction in these positive externalities.
Season-ticket holders are also indebted to scalpers. Though the season-ticket holders have chosen to absorb the scheduling time risk, they are more comfortable doing so with the expectation that, should something unavoidable arise, they could sell their ticket to a scalper. Thus the scalper provides a type of scheduling insurance. The scalper is able to provide liquidity for season-ticket holders.
If the season-ticket holder find himself or herself in a financial tight spot, he or she is able to recoup some or all of his or her ticket cost by selling to a scalper. These factors can increase the consumer's willingness to purchase season tickets. This is a major benefit to the team because season tickets often sell at quite a premium as compared to general admission tickets. It is difficult to see how prohibition of this act helps anyone; it certainly does not help the season-ticket holder or the team.
Event goers benefit from the high level of convenience provided by the scalper. This convenience takes the form of easy accessibility. Attendees are not forced to plan as much and are able to show up at an event, spur of the moment, and purchase a ticket. This is a major benefit for those who are unable or unwilling to commit themselves to inflexible plans.
Even local workers and businesses benefit from the scalper's actions. People who do not have tickets often travel to the city hosting the game in the hopes of purchasing a ticket from a scalper once there. If the fan is unable to find a ticket at a price she or he deems reasonable, the chances are very good the individual will still visit local dining establishments and businesses before leaving town. Thus, restaurant workers get more tips, and businesses have higher sales than they would without the expectation of last-minute ticket availability. By banning scalping, local governments are effectively stealing this additional income from the community.
Clearly, scalpers provide vast benefits for entire communities. Unfortunately, the often-illegal nature of their work reduces the benefits to be had. As with any prohibited good or service, there is always a risk premium associated with its illegal provision. Buyers are forced to compensate the scalper for undertaking the legal risk associated with providing this harmless service. The legal risk also creates an artificial barrier to entry. There are many citizens who would like to share in the profits to be had from ticket resale but who are unwilling to skirt the law. Thus there are fewer competitors in the market, and those willing to resell are able to earn higher profits.
The prohibited nature of the service also adds to the consumer's searching costs. In areas where scalping is prohibited, there exists no reliable location in which those desiring tickets can obtain them. There can be no ticket store. Since scalpers cannot open a shop, those desiring tickets must spend time and energy searching the area for clandestine scalpers. The inability to advertise greatly increases the search cost.
This is why clever scalpers hold up signs stating they need tickets while, at the same time, holding tickets high in the air as a signal of their desire to sell tickets. They are forced to advertise the opposite of what they are doing. While those who frequent games quickly learn to decipher this curious signal, many people unsuccessfully search for tickets, ignoring the very people they seek because they do not understand the cryptic message. Obviously, this headache is unnecessary.
Scalpers are hidden heroes at events. They take personal, financial, and legal risk in order to provide a critical service in the hopes of earning a profit from their labors. Many of the aspects of scalping that people decry are, in reality, a direct product of the prohibition placed on the service. The prohibition raises prices, reduces supply, and limits competition. In addition, in the absence of the prohibition of scalping, buyers would have legal recourse against unethical scalpers who sell counterfeit tickets.
Scalpers bravely defy ill-conceived laws. In doing so, they provide a service to the communities in which they operate. Though it is probably not their intention, they serve as warriors for the free market. They fight against the notion that people must be protected from free, uncoerced exchanges. The scalpers are as critical to a successful event as the food vendors, the gatekeepers, and the janitors. They should be afforded the same legal rights as everyone else.
Right on the money. Plus, I paid for two PSLs 10 years ago.
People wouldn’t have to worry about price gouging during emergencies if they were properly prepared.
A little forethought when you live in hurricane country, or any where else where a natural disaster is likely, will go a long way.
If we were housebound because of snow or ice, we’d be OK for a few weeks. I always make sure we’re prepared before winter really sets in. Aside from the fact that I don’t like hauling groceries through slop, in the cold, I hate fighting the crowds, especially when the weather is starting to get nasty anyway.
Gougers and scalpers wouldn’t be a problem if people planned ahead. In some respects, like with natural disasters, if they aren’t prepared, it’s their own stupid fault.
I did and I can’t disagree with melas.
(Haven't made it to Fenway Park yet, which I understand is right up there.)
Just a corollary; the worst MLB parks I've been to were Montreal, Toronto and Shea Stadium. But get to Dodger Stadium before they tear it down. It's a gem.
$150 each for two tickets to see Iron Maiden, Motorhead and Dio in 2003. That’s insane profit right there.
Most of the MLB, NBA & NFL teams now allow their season ticket-holders to re-sell their unwanted tickets directly on their websites. This has drastically cut down the scaleprs income.
The season ticket-holder can sell the ticket for whatever he thinks the market will bear and the team often adds a 10% “service charge” which they get to keep. Plus, the buyer knows that he has purchased a legitimate ticket and is not subject to buying a fake or invalid ticket.
We get there, and of course they're sold out. We hang around in front of the auditorium, and soon enough we get approach by scalpers, guy walking around saying “..ticketsmanticketsgottickets...” I picked out this brother who didn't look like the worst of the bunch, and I think we paid like $220 for a couple of $80 tickets. It was worth it and we had a great time.
Funny thing though, we got in early and some folks sat down a few rows in front of us, some guy and his girl. Apparently they had bought tickets from a scalper, too. Unfortunately, they were counterfeit tickets and the real seat-holders showed up, and this poor guy and his date got thrown out.
It’s obvious you have not had the same experience as most folks I know regarding scalpers and tickets.
At the last concert I attended, the “public” sales were all sold out within 12 MINUTES of the online box office opening, with a limit of 8 tix per transaction.
Face value on the tix was $65., but I paid the LEGAL, SANCTIONED vendor $105. per ticket, what with handling fees etc.
The “official” ticket seller had sold (to a shadow company) the VAST majority of the tix available, and had them up for sale on a (LINKED TO THEIR OFFICIAL) site for a premium of 150%!! That $65 ticket I “lucked out on” for $105 would cost the next guy $250! From a “SANCTIONED” seller!
Tell me how “good for the economy” scalpers are: PLICKUTBASTERD ITSELF is a scalper, with legal protections!
The “scalpers” you see outside games and concerts are small fry!
So far FRers are pretty down on Ticket Scalpers here.
Just because you don't see it, it need not be absent.
Think of the value added by wholesalers.
True. Isn't it the general principle of the world? Don't the airlines do the same with tickets? You pay for convenience of not being in line 3 hours prior to the event.
Exactly. I don't recall anybody sending them donations or even expressing a word of sympathy when the prices are down.
That's why we have a socialist in the White House: even conservatives don't like the markets. They only tolerate them when they work in their favor.
People freely buying and selling for a price they agree to is the very definition of an economy, a free one anyway. If the middle man is getting too big of chunk, as seems to be your complaint, that just means the producer should charge more. Or maybe it means the middle man is actually an agent of the producer, which is all well and good.
I live about 5 miles from Daytona International Speedway (DIS). For about a week before the Daytona 500, and the July 4th NASCAR races, if I had a dollar for every “Need Tickets” homemade sign I have seen in the 30 plus years I’ve lived here, I wouldn’t have to play the Florida Lottery ever again.
How some of the people sell their “extra” tickets is to “bundle” the ticket with something else.
Examples: A newspaper ad reads: Rent my 2 bedroom beachside condo for seven days Daytona 500 week for $5000 and get 4 FREE tickets to the big race.
The really clever one, is the scalper who will sell you the ball point pen out of his shirt pocket for a predetermined price, and “throw in” a couple of 500 tickets.
Sports Arenas are learning from their foolishness of trying to control a market and have instead allowed such to happen.
They've set up an eBay like system to allow season ticket holders to resell there ticket (you don't even have to ship them, they just print up new tickets and send them to the new buyer.)
We love the system which allows us to attend the games we wish and make a small profit on the remaining games which pays for the entire season.
Those aren’t scalpers then. My understanding is that those selling tickets legally are ticket brokers, and those who sell them illegally are scalpers.
No, forced scarcity is clear legal anti-trust.
You missed the bit where the original seller CREATED the shortage in the first place.
Thanks for playing. Sorry about the lack of cognizance.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.