[Androsynth]

Leaving money on the table does no one any favors. If people are willing to pay $150 for tickets and hes charging $50 (or whatever it is), he's only doing himself a disservice.

If people are willing to pay that much and he delivers a show that is up to his normal standard, they won't hate him for charging them that much; quite the opposite actually. It's only the price gauging and poor service of monopolies that people tend to hate (and for good reason).

Now, if you are saying 'what about the people who cant afford $150 for tickets?'. If it's not a charity show, the world definitely does not owe you tickets to a stand-up comedy show. On the other hand, charity shows are fine, but he should call it like it is if thats the case. $50 for tickets means the rich will pay less than theyre willing to pay and the poor won't get in anyways. No one wins in that situation.

[fusiongyro]

> he's only doing himself a disservice.

How precisely is the scalper, by increasing costs and adding _no value_ doing us a service?

[Androsynth]

Just because he is doing himself a disservice doesn't mean the scalpers are doing us a service.

[fusiongyro]

As worded it is implied that the scalper is doing _somebody_ a service, and I disagree with that.

[philwelch]

If they weren't doing anyone a service, they wouldn't make money.

[masklinn]

Of course they don't and still do: through speculation, they're artificially taking control of the supply allowing them to re-set its price point without providing value. The tickets would sell all the same through the original provider at the original price, they just inserted themselves between the producer and the consumer (usually through brute-forcing the producer's ordering scheme) in order to extract wealth from the consumer.

That's parasitism.

[philwelch]

That's pretty much impossible. If the market clearing rate is face value, scalping tickets for more than that wouldn't be viable.

Do you think running a corner store is "parasitism"?

[vacri]

The value that scalpers add is that you can get tickets at a later time. That's about the only value I can see that they provide, and whether that benefit is moral or not I guess depends on whether you believe in first-come-first-served for that item.

[sambe]

They are doing a service to anyone who buys scalped tickets, who is happy to pay extra rather than not go. Competition at this price is lower. I know many people who have happily paid well over face value on several occasions. Of course everyone would rather pay an artificially low price. Wanting a better deal isn't the same as the premium being extortion.

You may not like scalping but there's no point being blinkered about it.

[fusiongyro]

Except they're only paying extra because, ta-da!, the tickets were scalped. The competition is higher at the lower price because, ta-da!, the tickets were scalped.

The arguments for scalping only work if the effects of the scalping are ignored. Eliminating scalpers benefits everyone.

[jarek]

Scalping benefits people who wouldn't have gotten tickets in a non-scalped sale (e.g. because there were twice the amount of people interested at face price than tickets available) and are willing to pay more to get the tickets. Scalpers are exploiting the rigid pricing and release schedules of the tickets.

I don't support scalping but wish the artists and promoters would step up the fight themselves too.

[rquantz]

I don't support scalping but wish the artists and promoters would step up the fight themselves too.

That's exactly what Louis CK is doing.

[jarek]

Yup, and great for him! I wish more would do the same.

[sambe]

It's not so much an argument "for scalping" as an argument against being emotional and extreme. So, once again, - no, not everyone benefits. Without the higher price tickets available from the scalpers, they would not have been able to go. They got what they wanted at a price they could afford. Disliking something is not the same as it being inherently and totally evil.

[fusiongyro]

You're putting words in my mouth.

> Without the higher price tickets available from the scalpers, they would not have been able to go.

Again, this is assuming that the amount of competition for the tickets is not affected by the scalpers. In reality, the scalpers are exactly the ones driving the scarcity.

[philwelch]

Scalpers can only make money if there are more people willing to buy tickets at the face value than there are tickets available.

Here, go learn what a demand curve looks like and then think more carefully about this: http://www.khanacademy.org/finance-economics/microeconomics/...

[ionforce]

That's the whole point of scalping, to affect access to tickets. Has more money => has more access to scalped tickets vs normal tickets

[philwelch]

Suppose there are 1000 tickets for a show that are $20 each. There are 5000 people in town who would buy a ticket at that price. Without any scalping, the first 1000 people who show up get a ticket and 4000 people go home unhappy.

With scalping, the first 1000 people who show up still get tickets. 900 of them are scalpers. (So if you were in the first 100, you still got to pay face value.) I'm being very generous with this scenario--I've personally never seen a situation where this was a real problem, as I've gone to every ticketed event I've ever wanted to paying face value.

The 900 scalpers all pick different prices. At $40, there are about 2000 people left in town who want to buy a ticket. Some of them get tickets, but the other scalpers get wise and think, why not charge more? So they charge $50. Or $60. Eventually they reach a point where there are exactly n tickets left, and exactly n people left in town who are willing to buy at that price. If the scalpers overprice the ticket, no one will buy, so they'll need to lower the price again. But generally, what's reached is a fair price that sees all the tickets go to people who actually were willing to buy them at the price they bought them at.

So let's look at what's happened. Without scalping, you have 4000 people who missed out on buying tickets because they weren't first in line and 1000 people going to a show. With scalping, you still have 1000 people going to a show, but instead of all of them being picked on the less-than-perfectly-fair basis of who was first in line (which is a disadvantage to people with more work, more responsibilities, inconveniently timed emergencies, and slow internet connections), some of them are picked based on who was first in line, and some of them are picked based on who was willing to pay more (which is a disadvantage to people with less money).

You might think, well, it's better to be unfair to busy people than to be unfair to poor people. But let's change this thought experiment and say the face value of the tickets was $60 to begin with instead of $20, and at $60, there are exactly 1000 people in town who are willing to buy a ticket. Now there are no scalpers (or if any scalpers do show up, they can only resell the ticket for face value anyway). I would argue that this scenario is strictly less fair than the scenario where the face value was $20 and there was some scalping, because at least in the first scenario, it was possible to get a lower price by getting in line first!

Fundamentally, what difference does it make who's setting the price? You might say, well, if the face value was $60, at least the performer (or the venue, or the ticket vendor) is getting the extra money, not just some "scalper". But the scalper is effectively getting in line for you. He's going out of his way to do the leg work for you. You know who else we pay a premium to for doing the leg work? Shopkeepers. Sure, if we really wanted to, we could go to some warehouse and save some money by buying all our stuff off a pallet. (You still can if you want to--it's called Costco.) But maybe I'd rather some other guy does all that legwork for me, and in exchange, I'll pay more. And if you're running around doing legwork for other people, you are benefitting those people.

[ticket_guru]

Another perspective on your thinking here, which I think over simplifies the situation.

On my blog (http://www.ticketeconomist.com/prices-101/), I have a chart that observes internet ticket resale for a couple of sold out concerts in 2005 and 2006. Sticking with your terms, the 900 and the 100 bought and sold out the show in 2 minutes. Now, 900 people who wanted to actually buy tickets and see the show have to go to the secondary market. 900 speculators crowded out 900 fans and now they are clearing prices that are anywhere from $10 to $100 above face. It is relevant to point out that the 900 have a number of methods for essentially cutting the line, so there are instances where the "service" involved some form of cheating the system. Is that good?

In fairness, the scenario you present is also not the norm. More often, 1,000 sophisticated buyers compete with 15,000 average Joe buyers for 10,000 tickets. The 1,000 buy the best 2,000 seats and the 15,000 fight it out for remaining 8,000 tickets, assuming there are no hold backs and that Ticketmaster's website works properly, which it often does not. At that point, some fraction of 11,000 desperate and dedicated fans turn to StubHub, eBay, etc. to find that that the $90 ticket is now $190. On the one hand, there was never enough supply to go around in the first place, on the other, 1,000 buyers were crowded out by speculators. The efficient market is really not so efficient with tickets for a complex series of reasons.

Finally, there are some sophisticated buyers who know that they can wait it out and buy tickets at or near face value close to show time. We are among those few, for now.

[fusiongyro]

Critical to your argument is the idea that standing in line is a service someone can charge for. It makes no sense when tickets are sold online 24/7 rather than out a window at a particular physical location. There is no line and no inconvenience to pay someone else to endure.

[philwelch]

24/7, but only until the tickets are sold out. It's inconvenient for me to schedule my life around when tickets are going on sale. But a scalper's entire business is scheduled around when tickets are going on sale.

And if you think that problem is somehow created by the scalpers, go learn what a demand curve looks like. When tickets are underpriced badly enough, obsessive fans with fewer responsibilities are going to buy up all the tickets before I'll have a chance. If the prices are high enough relative to demand that I actually could buy tickets whenever I want, 24/7, then scalpers are irrelevant. Even if they did buy up all the tickets, they'd have to sell them back to me at basically face value. Scalpers aren't a cartel or anything, they can't fix prices, and their inventory goes bad almost instantly when the event actually happens.

The convenience argument isn't actually that critical, though. What's more critical is that by allowing people to get tickets two different ways--either buying them earlier, OR paying more--scalpers also make the ticket distribution more fair, not just more convenient for those willing to pay more.

[jbooth]

By increasing liquidity!!

[balloot]

What Louis CK is essentially saying is that given a large amount of money already in the bank, it is more valuable for him to have affordable tickets than it is for him to maximize revenue. That is a decision that is perfectly rational. Not everyone gets their full utility from making the absolute maximum amount of money possible.

Also, a side effect of this is that below-market value tickets create a shortage, which in turn makes it valuable to be the first to learn about new tickets. This has to be driving signups to his mailing list and twitter feed.

[vacri]

Leaving money on the table does no one any favors.

God bless the US health system!

$50 for tickets means the rich will pay less than theyre willing to pay and the poor won't get in anyways. No one wins in that situation.

Economists are crazy. A full house is a full house. The people who win are the people who attended. How you can possibly say 'no-one wins' from a full house of successful comedy on the cheap is beyond me. Yeah, bummer, the cheap tickets to a very entertaining night left us all feeling crappy...

[dagw]

First of all, just because there are a number of people willing to pay $150, that doesn't necessarily mean there are enough of them to sell out every show. So now he either has to lower prices as the dates approach or play to half full venues. Both of which are obviously sub-optimal.

Secondly you're ignoring the broader message sent by charging $150. Even if he can find enough people willing to pay that to fill a small venue, it risks sending the wrong message and pissing off people who might otherwise have bought his DVDs, watched his TV shows or gone to other shows. So now instead of being seen as broadly popular "man of the people" who "sticks up for his fans" with wide appeal, he's seen as a stuck up rich fucker entertaining other stuck-up rich fuckers. This will have obviously negative effects on his TV ratings, where I suspect is where he makes most of his money.

[jeffool]

>Leaving money on the table does no one any favors.

Except fans. Who can now buy his DVDs or other swag. (Or afford both his show, and rent.)

If your goal is to get as much money as quickly as possible, there's another word for that. Short-sightedness.