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Ticket Scalping

Massachusetts has been considering increasing the control over ticket resale or scalping.  The current laws are ridiculous and are completely ignored.  Ticket mark-ups are limited to $2 (that may have been more significant in 1924 when the law was passed).  A law that out of date is a waste of time, although there have been lawsuits filed about it.

You can't stop entrepreneurial activity.  StubHub is selling tickets that they don't have yet, but they know they can get them.  They are counting on the laws of supply and demand to ensure that they'll be able to make a profit on these.

I don't think that the government can do much here.  I don't like laws like the current one on the books that try to limit the mark-up you can make on tickets.  These laws are willing to short-circuit the supply and demand market forces to limit the upside that a scalper can make, but no one protects their downside.  It seems like a windfall to sell tickets way above face value.  And, Patriots and Red Sox tickets are a hot commodity in Boston these days.  If you have a source of these at face value, you can make plenty of money selling them.

However, what about other tickets?  I recently sold some of my Celtics tickets on eBay.  I don't try to make money on these, and that's a good thing.  Because, you can't.  I was only able to sell the tickets for just over half of face value.  Now, I am not worried about the money.  I view the total coast for my half-season of Celtics tickets to be an experience cost, which I get the benefit of when I bring one of my kids or a friend to the game.  Perhaps that's a rationalization for paying a high price, but that's OK.

However, if I was a ticket agent who had agreed to buy some fan's Celtics season tickets at face value, I'd be going out of business.  So, if a ticket agent can lose lots of money when a team is not in high demand, why can't they benefit from owning a hot commodity when a team is sold out?  That's supply and demand, and the marketplace has a way of making this work out.

Now, what about the 'average Joe' fan who can be priced out of a game?  I think that just about every team offers some tickets at reasonable prices, and most teams have some sort of egalitarian method of making tickets available to their average fans.  Keep in mind that these average fans benefit when the Red Sox have enough money to pay $51M just to negotiate with a Japanese pitcher.  Higher-priced tickets are an important revenue source.  The team has an obligation to maximize its revenue and good public relations will dictate that they don't totally lose the support of their average fans (they at least need them to watch the games on TV to keep the ratings up!).

Tickets (sports or otherwise) is a business.  Let basic economics drive the prices.  I'd rather see the teams benefit from these high prices as it will help hot teams earn more money to spend on better players and coaches.  But, there is no way that the government should be figuring out how to fairly mark up a ticket, and certainly not look at it once every 80 years or so.

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