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Source link: http://archive.mises.org/11209/ticket-scalpers-are-hidden-heroes/

Ticket Scalpers Are Hidden Heroes

December 10, 2009 by

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? FULL ARTICLE by Briggs Armstrong


Scalp Her December 10, 2009 at 8:36 am

What about Obama’s inauguration tickets ?

Those “free” but scarce tickets were given by the government to some individuals, many of whom decided to sell them to the highest bidder.

Diane Feinstein wanted to jail those who sold those scarce tickets who were supposed to be free.

One has a ticket, the other has money. How can this be a crime ?

In fact, if that is their attitude, I would have flushed my ticket down the toilet instead of going kissing the government’s butt.

I think that the issue the government has about scalpers is that they deal in cash which is very difficult for the government to trace and tax. Scalpers are first users of their profits, they can’t be taxed at the source like the rest of us wage slaves. This must be what irritates the government.

iceberg December 10, 2009 at 9:07 am

I have a niggling feeling that ticket prices are pressured downward by state pressure, after all the masses must have their bread and circuses. (I believe this is true of both the NY Yankees and the NY Mets who have both been pressured by lawmakers to reduce their ticket pricing since they have been beneficiaries of government largesse.)

Ceteris paribus, this widens the opportunity for the hated entrepreneurial scalper to exploit the arbitrage between the price ceiling and the market clearing price.

Surely the scalper supports the anti-scalping laws as he thus benefits from this unholy baptist-bootlegger arrangement.

Scalp Her December 10, 2009 at 9:41 am

“the anti-scalping laws”

Imagine a ticket lord and organized ticket crime. Bikers will sell tickets and tungsten light bulbs, not drugs, LOL !

Bogart December 10, 2009 at 10:40 am

Just another instance of the age old practice of “Blame the Speculator” who supposedly raises the prices of things in some magic way when in reality has no control over the price as these are set by supply and demand.

htran December 10, 2009 at 12:05 pm

This article makes me smile. It’s unbelievable how so many people see uncoercive “speculating” as bad, but it’s okay for the state to subjegate the masses as long as it’s defined as a “common good.” So sad.

PirateRothbard December 10, 2009 at 1:38 pm

Neat article, but I suspect in a free society ticket scalpers will still face negative consequences.

Companies will sell tickets with and ask buyers to sign no scalping agreements.

Scalp Her December 10, 2009 at 2:26 pm

Pirate Rothbard,

That would easily be debunked in a private court system as the ticket, once bought by the buyer, is the buyer’s private property so the companies cannot dictate what the buyer can do with the ticket.

Also, scalping will still happen and such anti-scalping agreements would be unenforceable unless you disclose your complete personal information prior to buying the ticket.

I don’t think that the masses will be thrilled to make registered ticket purchases so companies trying to force buyers to sign no scalp agreements will face massive boycott.

Would you buy a ticket if you were forced to disclose your personal information and sign a paper in case the company wants to sue you later ? I didn’t think so.

The market is the law, under free market capitalism, companies would have to live with scalpers.

Also, consider that many individual ticket buyers oftenly resell their ticket to members of their family as a service to them or because they had last-minute plan change etc.

No, your no scalping agreement will not work. Companies who do that will go out of business.

Shay December 10, 2009 at 4:09 pm

Scalp Her, I believe the airline industry already employs an effective anti-scalping method: put the person’s name on the ticket, and require identification when the ticket is being accepted. With tickets to an event, you wouldn’t even need to require identification when selling the ticket, just when accepting it at the event. A scalper couldn’t know in advance the name of his buyer (if he did, his buyer could just buy the ticket directly without the scalper’s help).

JackSkylark December 10, 2009 at 4:26 pm

Scalp Her,
I’m sorry but property can be contracted. If property is defined as justified jurisdiction in relation to action – then contracts play a big part in what can and can not be done with ‘property.’

As to your second point, many companies already have ‘anti-scalper’ policies that work just fine and are entirely valid.

ABR December 10, 2009 at 4:28 pm

The airline industry also employs a dynamic pricing system using mainframe computers. Less room for scalpers even if they were allowed to operate.

Will entertainment venues adopt dynamic pricing one day also? Or auctions for events anticipated to be wildly popular?

peacebyjesus.com December 10, 2009 at 6:57 pm

As one who has, not many years past, spent many many hours at sporting and other events, holding forth a different “ticket”, these being gospel tracts, i have found scalpers to be unique and very hardworking people, and even defending our work. I am sorry that it is illegal, and cannot support doing illegal stuff, though it certainly is capitalism. If it is not legalized i hope they can get out of it, but many of them have records for relatively minor offenses which makes it hard for them to get regular jobs.

hotdogseller December 10, 2009 at 7:05 pm

Ticket scalping is legal in INDIANA! ( Gods country)

Jordan Inman December 10, 2009 at 7:53 pm

Join a facebook group I created inspired by the ticket scalper chapter in Defending the Undefendable. Search “I LOVE Ticket Scalpers!” on facebook or go here: http://www.facebook.com/#/group.php?gid=132406134418&ref=ts

StraT December 10, 2009 at 8:44 pm

Isnt part of the ban on scalpers to reduce forgeries ? Theres similar laws in Australia that make it difficult to buy physical tickets before the day of the event (only for some type of events.) I remember before there was an underground event and the management was trying to get rid of scalpers to control the fake tickets coming through.

Gil December 10, 2009 at 11:57 pm

Does ticket scalping mean the tickets were priced too cheaply. Maybe the ticket sellers should use an eBay-like to system to allow buyers compete with each other to find out what the real price of a ticket is?

Robby December 11, 2009 at 12:26 am

Scalp Her and respondants:

Companies could theoretically employ contract limitations on the use of tickets after purchase. To suggest otherwise is to deny freedom of contract and property rights. Whether anyone would buy tickets subject to such restriction, in the presence of other, unrestricted options, would have to be borne out be the market. There are upsides to an event banning resale: part of the deal may be that you know with whom you’re sitting, for example, and forbidding resale would maintain that component of the deal. Making it enforceable could also be done in several ways, the most obvious being issuing a non-negotiable right to pick up a ticket at will-call at the time of the event.

Reduction of forgeries may be part of the point, but the ban likely has the opposite effect. If scalping is illegal, Purchaser cannot have a cause of action against Scalper/Forger, because courts don’t enforce contracts for illegal activities. Just like you can’t sue the hit man you hired if he fails to kill the target. The total absence of enforceable rights against Scalper encourages Scalper to sell forgeries. If Scalper is allowed to be an “honest businessman,” risk-averse Purchasers will only buy scalped tickets at the storefront with a good reputation (at an increased price over the guy on the sidewalk, but with an increased probability of getting a legit ticket). Getting rid of scalpers is a dumb idea, if for no other reason than that it won’t work. Trying to get rid of scalpers probably increases the incidence of forgeries at the gates because no legitimate scalpers can exist through whom to obtain legitimate tickets.

Maybe. Like Briggs pointed out, tickets before the season have a value that likely differs from tickets on game day. Here in East Tennessee, where our largest church is named Neyland Stadium, ticket prices fluctuate wildly depending on the game (but much less on the seat in the stadium). The football team plays only one to three quality opponents at home each year out of six to eight home games. The University sells the tickets before the season in tiered pricing, but at differences like $50 for terrible opponents, $60 for the decent ones, and $70 for couple of really big games. That is stupid, but it’s easier than putting up with all the brainless nonsense about fairness and greedy corporatism (the money the University athletic department makes is paid to its employees, and the “excess” (we don’t say the profit word at a public university, after all) is donated back to the university). So, if you buy season tickets, you invest an average of right at $60/game. On the street, however, the terrible games sell for $5-$20, the decent games for $20-$30, and the couple of good games for upwards of $250. Unless the Vols are 1-5 coming into the Alabama game the Third Saturday in October. Then that ticket, which before the season would have been a “good” game, may well sell for $20.

All that to say this: it’s not so much that the tickets are priced inaccurately at the initial pre-sale, but that the pre-sale cannot account for future events that day-of scalpers can.

Quulani December 11, 2009 at 2:29 am

Hooray for this article. Some may dislike scalpers and scalping, perhaps because they sometimes demand high prices for tickets. But an undesired price is the result of a supply-demand imbalance in the market; the scalper is not to blame. Sometimes a ticket’s market value can actually fall below its face price. If it’s a rainy day at Madison Square Garden, the scalpers will be left holding hundreds of seats and you’ll get into the event for $10.

P.M.Lawrence December 11, 2009 at 4:51 am

“The more the local law enforcement cracks down on scalpers, the greater the reduction in these positive externalities”.

In fact, even stipulating that the rest of the reasoning is sound – in fact, arising from its soundness – those wouldn’t be positive externalities in the ordinary sense at all because they would be results of free market transactions. E.g., see the reasoning about pecuniary externalities here.

Ticket-off December 11, 2009 at 11:07 am

There are multiple points being missed in the discussion here. The biggest is that of ownership. In the context of sporting events we are talking about a venue largely funded by public money. At some point in the process, the operating companies license ticket sales out to ticketmaster and the like. These companies in turn charge us a “service fee” above and beyond the cost of tickets, which is pure profit for them. So essentially, we buy the stadium, only to have some pundit or for-profit exec engage in a for-profit licensing of ticket sales, that in turn binds us to some contractual obligation to pay unjust fees just for the right of entry to that stadium. Absolutely no different from me standing outside your house and charging you a fee to enter, with the police at my side just in case you try to enter without paying whatever arbitrary fees I choose to charge.

Is this the country you hoped for?

Even in the case of private venues, the antitrust aspect is still there. Most concerts, circuses, ice capades, etc utilize one ticket broker who charges a standard fee that is nothing more than an additional profit for them. And we often have no alternate means to get tickets. We drafted Anti-Trust laws based on THIS EXACT PRACTICE. We deregulated the phone and cable companies FOR THIS EXACT PRACTICE. That this practice is legally protected in the world of ticket sales is completely indefensible. Furthermore the way they attempt head off scalping is with the claim that your ticket represents a “license to view content”. However venues do not own the content and thus do not have any legal authority to bind you to some license agreement to see it. Nobody has ever challenged this in court, but if they did it would be about a 3 second case. I have a “officially licensed” NFL jersey. All logos, numbers, designs etc are licensed from the NFL, but once I own the jersey, the NFL would never challenge my right to sell it to by neighbor.

The “case” against ticket scalpers has no constitutional basis. Quite to the contrary scalping is considerably more in line with constitiutional principles than the accepted ticket sale practices. And the reason for this, like many of the corrupt political and business schemes we are subjected to daily, is because we have tolerated it being like this. And our “tolerance” has enabled the corrupt to put capitalists in jail for a perceived infringement on the profits of monopolists.

Is this what the United States of America stands for? Allowing usurers to cripple free market capitalism because we’re too lazy to defend the principles of our Constitution.

That answer is YES! All heil Ticketmaster…

david July 21, 2010 at 6:43 pm

i want to challenge the kansas city royals in court,buying and selling tickets in the state of missouri is legal.city ordinance it is legal 50 feet from public entrance. kansas city(owner) built the stadium leased it to the county(landlord) which subleased it to the royals. royals say that they are private so the stadium is private and parking lots you can not buy or sell on property without there permission which they wont give

Bryan Morton December 11, 2009 at 6:59 pm

I’ve been wondering for quite some time now why entertainers haven’t dumped Ticketbastards and started selling their tickets on eBay. Highest bidder gets the seat.

Brandon Wilson December 12, 2009 at 12:32 pm

I think the part that most people are forgetting is the main issue with scalpers is accessibility. Say I am a band, I contract ticketmaster to sell tickets to my show on some guideline. Say 60 dollars front row down to 20 dollars for the back of the stadium/venue. Along comes dedicated fan, who waits on the website refreshing the page until the tickets become available to buy up front row tickets. As soon as I am able to buy tickets I do so, only to find out that all the best seats are already taken. Many of these spots are taken by scalpers so now I am forced to pay double, triple, or more to buy the ticket I wanted simply because they had a faster internet connection. This assumes I can afford the new scalper rate at all. This is the experience that people are trying to avoid.

For a real life example, the Beijing Olympics. The stadium was often 3/4 empty on “sold out” sales because the scalpers bought the majority of tickets hoping to find the one desperate/rich guy/girl who’d buy the ticket for $2000 or $3000. Sure this is free market, but it is not enhancing the experience for very many people.

I would go so far as to say that scalpers are evil, but I certainly wouldn’t call them heroes.

Brandon Wilson December 12, 2009 at 12:36 pm

Edit to my comment above

“I wouldn’t go so far as to say that scalpers are evil”

Shay December 12, 2009 at 2:30 pm

Brandon Wilson, you argue for a system where it’s simply luck that a particular person gets a good seat for a low price. The free market is about pricing things according to their value, so it naturally wants to put a high price on something that requires lots of luck to get. It may mean that you now have no chance of getting it by mere luck, but it does mean that you can still get it if you save up. You might have to make other sacrifices, but you can then be almost assured of getting it. Again, this is how the free market works. Reducing uncertainty allows better planning by everyone.

To go at this from a different angle, the way you want ticket sales operated applied to other things would mean for example that you go to get a flat panel TV or computer, only to find that they’re all out of stock. Looking closely you see that they are priced insanely low: $50 for a 50-inch flat panel TV, $35 for a modern computer. You realize you’ll never have a chance at getting one of these, unless you spent vast amounts of time ensuring you’re the first to get one the next time a shipment comes in.

Brandon December 12, 2009 at 5:53 pm

Shay, thanks for your reasoned arguments. Really makes my day to be out-thunk.

Above I was describing some of my frustrations with scalpers and trying to find tickets. Hopefully, if resale was not prohibited then more people would do so and drive down the price on high-value tickets. We could end up with a Walmart of ticket resales where the price of the ticket is closer to market value + 6% profit. Then I could get the ticket I want, at a fair price, without paying for a risk premium.

The parallels to the illegal drug industry, I guess, shouldn’t be surprising.

Another side thought, maybe the bands should employ dynamic pricing. I would rather pay $200 to support the band I like than pay the guy who was lucky enough to get the tickets I want.

Mark December 14, 2009 at 2:17 pm

This is very interesting. I wrote about this subject on my own blog last February. Gave it a more personal touch.


gene December 14, 2009 at 2:20 pm

Scalping has very little to do with the “free” market.

I would like to hear of one event, especially sporting, that doesn’t have big government involvement and monopolies that scalpers participate in?

Those stadiums and event centers are almost exclusively public projects. The media is controlled by monopolies and a couple of corporations are allowed to monopolize the distribution of tickets. Not to mention copyright monopolies that hinder other performers from competing.

Without that, with a true free market, it is likely tickets would be so cheap and events so common that scalpers would have little incentive. Scalpers are able to skim a bit of fluff off the monopoly markets and who can blame them for that?

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