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Trying to make money? Did you forget you're in Massachusetts?

One of the unspoken laws down in Massachusetts is that nobody -- nobody -- is allowed to make a profit without cutting the government in for a piece of the pie. Entrepeneurship is bad, evil, and greedy; you need to make sure you pay your "fair share" into the state's coffers.

One of the many ways they enforce this unwritten laws is the laws against "scalping." I understand that a lot of states have laws against reselling tickets for much more than their face value, but in Massachusetts it's tougher than that. Resellers have to register with the state, and markups are limited to $2.00 over face value (plus "reasonable" fees).

Well, it seems that a lot of people have been ignoring that law, and thinking that if they own something, they can sell it for whatever someone is willing to pay for it. And that has quite a few people annoyed -- to the point of taking them to court.

I'm not surprised that the Patriots are using the existing laws. They are a private organization, and they have a duty to maximize their profits. Under existing law, they are perfectly entitled to do what they are doing.

But the mere fact that what they are doing is legal is appalling.

I'm no fan of "gouging," but let's not overlook the fundamental fact here: these are tickets to a football game. This is not a matter of life and death. No one will be irreparably harmed if they can't afford to go see the Patriots play. If they want to badly enough, they will find a way.

The free market is an amazing thing. The fact that people are willing to pay so much above face value for these tickets tells me that the tickets themselves are being underpriced by the team. If the Patriots want to get more money for them, then they can charge more up front. To insist that once they've sold the ticket, they also want a piece of any future re-selling is just absurd.

But as so often is the case in Massachusetts, the more absurd an idea seems, the more likely it is to be enshrined in law.


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Comments (28)

I've never understood the i... (Below threshold)
Faith+1:

I've never understood the illegality of scalping. Sure, the scalper may be getting the listed value--but it's also a limited time the value is held. If he goes too high and the game ends he's out the original investment.

It's a good thing Wall St is in New York and not Boston.

Jay,Please read wh... (Below threshold)
Gringo:

Jay,

Please read what Thomas Sowell has to say about gouging and see if you don't reevaluate being against it.

The whole messy business of... (Below threshold)

The whole messy business of anti-scalping law is, well, a mess.

Granted that under normal circumstances, it would be foolish to argue that one has no right to set whatever price one pleases on one's property. The exception made for tickets to unique events -- sporting contests and similar occasions -- is founded on those events' uniqueness. They don't share the renewability property of most other sorts of goods.

John Locke himself wrote that property rights as he understood them required the premise that there's "enough and as good left for others." Did he have this sort of thing in mind? Probably not, as the 18th Century had very few rock stars and professional sports franchises. But it's interesting to look at the theory behind anti-scalping laws in that light.

If a reseller is permitted to set whatever price he pleases on tickets, it's at least thinkable that he can glom them all and then effectively raise the price of admission to the event to what he thinks he can get away with. He becomes a "replacement monopolist" -- the original monopolist being the site of the event. This is a more plausible development for a unique event than for a renewable good (almost all material goods). One could argue that this is no fairer or less fair than the original state of affairs, but it does have an unpleasant cast to it.

What do the anti-scalping laws accomplish? Probably not very much, as they're quite difficult to enforce. That being the case, they're good candidates for repeal; an unenforceable law weakens respect for all laws. But the impulse that gave rise to them is not entirely irrational.

Mass, the home of the Big D... (Below threshold)
Gianni:

Mass, the home of the Big Dig, where scalping takes on a whole new BILLION dollar level, but its 'illegal' for a willing buyer and a willing seller to exchange a ticket for money.

"Renewability property" is ... (Below threshold)
smartguy:

"Renewability property" is originally from the Latin meaning "screw individual rights".

If I am an owner of an item, I should have the inherent right to sell that item for whatever someone is willing to pay for it, as long as I have not misrepresented the item in order to deceive the buyer(s). It's not surprising that Mass. does not understand that though. Look who they keep electing.

Francis:Eloquent, ... (Below threshold)
epador:

Francis:

Eloquent, yet still aromatic in a way more attuned the the bouquet of an ancient Roman privy than modern American bath.

And either an appropriate place to dispose of such waste products from human social and economic evolution.

BTW, there have been popula... (Below threshold)
epador:

BTW, there have been popular artists causing riots and unruly crowds for hundreds if not thousands of years. The pervasiveness of media/popular communication/advertising into the culture and daily life is perhaps more acute and technologically refined, but drives these phenomena as it always has.

Anti-scalping laws might be more acceptable to the general public if they included limitations on the original prices of tickets as well. But the obvious communist/socialist nature of the laws would then be harder to ignore and defend.

I guess folks don't refer t... (Below threshold)
Bob Jones:

I guess folks don't refer to Taxachussetts for nothing.

Francis' point is substanti... (Below threshold)

Francis' point is substantially more than theoretical.

The professional scalpers who work the Red Sox games succeed in amassing hundreds -- HUNDREDS -- of tickets for each home game (and a surprising number of away games -- especially in the Bronx). Those are tickets that are purchased directly from the Red Sox box office as well as from affiliated season ticket owners (they own the seats for the principal purpose of reselling them at a profit). If these people are free to resell tickets at whatever price they decide, it does indeed impact the ability of fans to be able to afford games.

This "willing seller - willing buyer" free-market principle is all well and good -- but it ignores entirely the concept that the team owners who are the original sellers of the tickets are entitled to place conditions or restrictions on the rights of the purchasers to resell. A ticket is a contract, after all.

The free market principle goes both ways.

That said, I would prefer that the team owners be the ones to control the contractual terms of their tickets, not the legislature.


Exactly, wavemaker. This i... (Below threshold)
epador:

Exactly, wavemaker. This is a problem for the purveyors, not the legislators, to solve. I can see broader applications of this approach that are foreign to the business of government as usual in Massachusetts.

Off Topic:What I w... (Below threshold)
WildWillie:

Off Topic:

What I wish is that the very many informed commments on this site keeps going on. This is my favorite site in my daily review of what is going on. I would like to ask all the right thinkers here to not be provoked by the likes of Lee and his leftist breathren. That is all they want to do, provoke, and many on this site take the bait and we always go off topic. Please, just ignore the trolls not matter how hard it seems.

"The professional scalpers ... (Below threshold)
Les Nessman:

"The professional scalpers who work the Red Sox games succeed in amassing hundreds -- HUNDREDS -- of tickets for each home game .."

Gasp! hundreds. Hundreds. HUNDREDS!!!!! The End Times are nigh!

"If these people are free to resell tickets at whatever price they decide, it does indeed impact the ability of fans to be able to afford games."

If the scalpers can easily get hundreds of tickets, why the hell can't the fans get them? The truth is, the fans can get them, they just choose not to. They let the scalpers do the work for them and then pay a premium for the service. What is so wrong with that? Nothing.

People, it's a g*ddam game. What idiot pays any price to see spoiled millionaires play for teams owned by multi-millionaires? All for the privelege to go to ballparks where you can't bring your own food or drink but you are forced to pay triple the normal price if you get hungry or thirsty? You're a dang fool if you do.


wavemaker,I suspec... (Below threshold)
robert:

wavemaker,

I suspect it is the supply and demand for Red Sox tickets that raises the price, not the hoarding of a few hundred tickets by a few hawkers. If the profit becomes enough you will get hundreds of resellers with a few tickets each. (This is stubhub). A few years ago, Laker tickets became so expensive that only movie stars could go, and the team got a fair chunk of that.

You will no more stop this than we stopped the drug trade, illegal though it may be. Free-market forces are strong.

Francis,

The Hunt brothers tried to corner the market in silver not so long ago, and discovered the built in compensation the market has always had. Oil speculators took quite a hit in September too.

And it is even harder to manipulate a price down.

Les, the fans can't get the... (Below threshold)

Les, the fans can't get them because the scalpers are experts in getting them FIRST. They pay kids to stand in line all day to be at the window first (while you're at work and your kids are in school).

Robert -- it is exactly that -- supply and demand, and scalpers corner the supply of game week tickets. And it's a hell of a lot more than "a few hawkers." The ONE professional ticket reseller I know well may have 100-200 seats for a home game -- and he competes with at least a dozen others.

And as I said, I support the team owners' right to control the reselling of the tickets through contractual terms with the initial purchaser. Free market concept, no?

wavemaker,No. Con... (Below threshold)
robert:

wavemaker,

No. Contractual obligations to limit resale price may be legal, but could not be considered free-market: the price a willing seller will convey something to a willing buyer.

Consider Stubhub (and others like it), which is more or less a market. Season ticket holders and others submit tickets and Stubhub manages the price according to the demand - this is done for millions of tickets in lots of venues.

It is true that speculators will always try to predict demand, sometimes they will win, sometimes lose. If a team has a long run with high ticket demand, more speculators will pour in.

This can take many forms. Indeed, more season tickets will be sold, particularly if a market exists for those games one does not want to go to.

Why would a team want to artificially lower demand for its tickets and thus lower season ticket sales?

Just as technology has exas... (Below threshold)
Mac Lorry:

Just as technology has exasperated the problem, so to can technology control the problem. It's actually quite simple. Make two types of tickets, named patron tickets and open market tickets. As now the tickets are available on a first come first server basis, but the named patron tickets are much cheaper as they can't be resold. The open market tickets are higher priced but they can be openly resold to anyone for whatever price the seller can get.

The named patron tickets have the name of the patron printed on them, both in plain text and also encrypted in a two dimension bar code such as that being used for e-postage stamps. While going through the usual search to get into such events, a person must show ID to use their name patron ticket.

The reason for cheaper named patron tickets is that major sporting events are held in facilities that were built with some amount of public funding, and that gives the state the right to control some aspects of the ticket sales. Why should people pay extra taxes to support millionaire athletes where only wealthy fans can afford to attend? Given the extra price teams can charge for open market tickets, they could further reduce the price of named patron tickets, and this makes taking the family to a game more affordable. That's important, because teams know that without young fans their days as a profitable business are numbered, and nothing turns a young person into a fan better than attending games with their parents.

Wow! I didn't understand th... (Below threshold)
RicardoVerde:

Wow! I didn't understand the concept until now. So, let me get this straight, ball team owners exercise their monopolistic rights (as granted by the US Congress) to sell a limited number of entrances to their show. Some enterprising individuals purchase lots of these at the price set by the owners, and then employ less fortunate, but also enterprising folk, to stand in line for them (thereby creating temporary employment where otherwise there would be none). The dozen scalpers control lets say 200 tickets each so that's 4800 seats out of a possible 48,000. The scalpers take full risk of losing their money on the game if poorly attended. The side effect of this is that it provides a means to bypass the monopoly-set price and possibly provide tickets at lower prices! It also transfers control over a limited resource to a larger group of people. Resource redistribution to the masses, but this time by market forces. Ain't America great!

Les said:If the scal... (Below threshold)
Les Nessman:

Les said:
If the scalpers can easily get hundreds of tickets, why the hell can't the fans get them? The truth is, the fans can get them, they just choose not to. They let the scalpers do the work for them and then pay a premium for the service.

wave said:
"Les, the fans can't get them because the scalpers are experts in getting them FIRST. They pay kids to stand in line all day to be at the window first (while you're at work and your kids are in school)."

Les sez - I don't see how that refutes my point. What is stopping a fan from having someone stand in line at the window? Absolutely nothing. The fan chooses not to hire someone to stand in line for him and instead chooses to let the scalper stand in line for him and pay him extra for this premium, luxury service.

Eh. All over some useless, worthless game. Oh well.

I'm thankful that we live in a country with enough riches and leisure time that we can afford to civilly debate such trivial things.

Happy Thanksgiving Wavemaker and everyone!


We stopped voting for publi... (Below threshold)
robert:

We stopped voting for public funded stadiums a long time ago here in Michigan. We now have new baseball and football stadiums and still a great basketball hall, good ones too, all privately funded. Try it you'll like it.

As to lowered prices so the children can come, as a business proposition I doubt it. More revenue for the team equals a better team, and that is the best way to build a fan base.

For those who complain about the scalpers, you should buy season tickets and sell those you don't want on the market. Likely you will recoup at least your cost, and you will be on the other side of this game.

The current capacity of Fen... (Below threshold)

The current capacity of Fenway Park is 36,108 for night games and 35,692 for day games Gilette seats 68,756. Scalpers tend to buy up 5000-8000 tickets at most other venues(up to 10,000 for really big football games), so I doubt it is any different in Beantown.

That leaves a boatload of tickets for fans willing to show up soon enough to get them.

Here in Dallas, Mavs, Stars, and Cowboys games are constantly sold out. Even though there is no restriction on off-property scalping, I have little difficulty getting tickets to any game I want to attend. If it's a big game and I don't want to wait in line, I will pay a premium for good seats. If I want to make a sacrifice to see the Stars on New Years Eve, that's my lookout, not the state's.

Sometimes overbuying by scalpers will bite them in the wallet. Back in the 80's Bruce Springsteen added an extra show to his tour stop at the Cotton Bowl. The scalpers went on a buying frenzy and bought 20% of the tickets. I purchased a ticket from one of those same scalpers on the day of the concert for face value. There were scalpers competing on who had the best seats for the buyer, desperate to offload their seats and cut their losses. I got to sit on the field about 20 rows from the stage for what a couple of days before would have bought nosebleed seats. That night the news was reporting about how the major ticket resale agencies lost a bundle on that concert and were selling below face an hour before the concert began. Independents also lost their shirts.

Scalpers do not have a monopoly (the teams do) nor do they overcharge. They charge what the buyers are willing to pay, otherwise no one would pay for their tickets. The fact that someone else is willing to pay more than you are is not the fault of the seller. Anti-scalping laws are anti-market, anti-property, and anti-freedom.

I'm fully in favor of ticke... (Below threshold)

I'm fully in favor of ticket scalping and price gouging, and not only that, but price gouging during emergencies such as floods or hurricanes.

Economics professor Walter E. Williams has written a lot on this, and his arguments are compelling, at least to me.

HTG to you too Les.<p... (Below threshold)

HTG to you too Les.

Robert -- how does a team's effort to prevent scalping "artificially lower demand for its tickets and thus lower season ticket sales." It seems to me that making tickets available at the lowest possible price through one reliable source would do the exact opposite. If the price for game day tickets is lower, there are more potential customers for them.

Here in Los Angeles, resell... (Below threshold)
SoCalst:

Here in Los Angeles, reselling event tickets for higher than the face value isn't a crime, and dozens of ticket brokers do a good business from small storefronts near the sports venues, as well as through the paper, and on eBay (huge market there).

What IS illegal is reselling tickets on the property of the venue (this is a local ordinance), or selling on the street (this requires a street vending permit).

wavemaker,OK, I'm ... (Below threshold)
robert:

wavemaker,

OK, I'm going to get out the crayons again and draw a picture for you.

Let's suppose we go your way. Create some contracts against resale, pass some laws, and hire a bunch of cops running around jailing fans.

Say, we jailed 10,000. There would still be another 10,000 likely willing to run the risk for a high profile game. We wouldn't be successful stopping scalping, but we would dampen demand and raise the price. (scalpers would go underground and charge even more). Take a good look at the drug market.

The more there is scalping, in other words the more demand, the more there is higher season ticket sales. This is true for two reasons: (1) ticket buyers have a market for those games they don't want to go to (2) They can get tickets, and at a net lower price rather than pay the scalpers' rates.

Higher season ticket sales is the gold standard for pro sports. Owners get a lower cost of sales, they can better plan a budget, and when season ticket sales near the maximum they can raise prices. Higher income = better team = more demand.

In your world, you want owners to reduce prices for you and your family. You want me to pay taxes to hire cops to run around enforcing your ideas about anti-scalping. You probably want me also to pay taxes to build stadiums to subsidize your price further.

Evidently, you are quite willing to pay $ 200 to government to lower your cost $ 100. You don't care, you are only concerned with you.

Fine then, vote Socialist. But please don't run my business - you would suck at it.

High demand comes from a good team. For bad teams, they can't give away the tickets. Fans that want low ticket prices often don't realize that this means that they also want a bad team.

And heres yet another attac... (Below threshold)
Sal Manella:

And heres yet another attack on the state of Mass.

Heres some Mass insanity: Proposition 2.5 Ever heard of it? It protects Massachusetts property owners from run away taxes. Nothing like that in NH, why not?

In this case, the Patriots ... (Below threshold)
Steve L.:

In this case, the Patriots are not hurt in any way, shape or form by the brokers. The team gets its full price for the tickets. The consumers have the choice to buy the tickets from the broker or not. If people weren't willing to pay the price that brokers ask, there wouldn't be brokers.

Robert, since you insist on... (Below threshold)

Robert, since you insist on behaving like a pompous, arrogant ass, I shall treat you as such.

You have no need for the crayons, unless you wish to use them to insert into your own chosen orifice.

As I have stated in both of my posts, I do not favor government involvement in this. You seem (ignorantly) to assume that I am a liberal because of your mistaken assumption that "new laws" are what I advocate (twice my posts state otherwise -- read carefully).

You say (wrongly, again), "Let's suppose we go your way. Create some contracts against resale, pass some laws, and hire a bunch of cops running around jailing fans."

You don't "pass some laws and hire a bunch of cops running around jailing fans." Where the f**k did you get that from, meathead?

As is the case with the new England Patriots, the season ticket holder enters into a CONTRACT (that simple form of FREE ENTERPRISE that we hold so dear),the terms of which are consistent with the rest of the NFL teams. This particualr contract includes the promise of the Holder not to resell the ticket to ANY third party, no matter what the price. I tend to think that's somewhat inconvenient, but as the free market states, if you don't like the terms, you don't have to buy.

Each ticket to a Patriots game includes a bar code that is scanned upon entry. Where tickets are stolen, lost, etc. and reported so to the team, the bar codes are canceled from the system and anyone attempting to use them is denied entry to the stadium. So too for tickets belonging to a season ticket holder who has violated the terms of his CONTRACT and had his REVOCABLE LICENSE to a game revoked.

Are you with me still, Robert. Anything not FREE MARKET enough for you yet?

Let's say that after a short while of having this message repeated on the jumbotron time and again, fans actually begin to understand that (1) they shouldn't risk the chance of being ripped off by purchasing scalped tickets in the parking lot for 250% of their face value, and (2) they can go to the team's website regularly and check for available tickets AT FACE VALUE, purchased securely, without such risk.

Now, the idea here is not to JAIL SCALPERS (Jesus what an ass), it is for the team to be able to control the resale of "a href="http://www.ticketmaster.com/h/purchase.html">REVOCABLE LICENSES (that's what the game ticket is, did you understand that, Robert? Do you know what that is Robert?). In so doing they improve the opportunity for fans to (1) purchase a ticket from a reliable source (2) at a price that reflects its comparative value (3) in a manner that protects the revenue structure of the team and (4) permits the team to influence the economic behavior of the season ticket holders (as is its CONTRACTUAL RIGHT).

With me, nitwit?

Finally, you say:

In your world, you want owners to reduce prices for you and your family. You want me to pay taxes to hire cops to run around enforcing your ideas about anti-scalping. You probably want me also to pay taxes to build stadiums to subsidize your price further.

Bobbo -- get off the lythium pal. The owners can charge what ever they think they can get (I know, dipshit -- I had a season ticket account with 12 seats for 22 years). If the team wants to enforce its contracts, it can hire its own police force to patrol its own parking lot and monitor resale websites (as it already does). And I CERTAINLY don't want to support stadium construction with tax subsidies.

Now let me go sharpen my crayons in case you need a clearer picture.

wavemaker,Wow, all... (Below threshold)
robert:

wavemaker,

Wow, all that crap and you still don't get it.

You are apparently aware that your language on the ticket, or your scoreboard messages, will not do shit. Otherwise you would not have made your suggestion about teams hiring their own cops.

Are you going to send them to the suburbs, the Internet, or the newspapers? Because that is where the market is for the majority of tickets.

What then, shoot them? Polonium 210? A strongly worded warning?

Get real. Find me someplace where there is no scalping, then we'll talk.




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