Assessing the Economic Rationale and Legal Remedies for Ticket Scalping
![handle is hein.journals/jleg16 and id is 7 raw text is: ASSESSING THE ECONOMIC RATIONALE AND
LEGAL REMEDIES FOR TICKET SCALPING
Stephen K. Happel*
Marianne M. Jennings**
INTRODUCTION
Hal (not his real name) is black, nondescript and [thirty-one years of age].
When I met him outside Yankee Stadium, he wore a torn Steelers T-shirt and
jeans. Hal is the quintessential exponent of free-market economics. Or, as the
legal system would have it, black-market economics. Throughout our conversation
he was on the lookout for police-uniformed and un-uniformed and undercover.
Hal enjoys his trade. He should: It's a sweet gig. I gave Hal $20. My seat was
excellent: behind third base, eight rows back. Indeed, I wouldn't have come
uptown at all had I not known that some scalper or other would serve me well.
I have a crazy schedule. I can't buy in advance. The man sitting beside me had
sold my ticket to Hal for $7.50 (a corporate box he couldn't use). He was happy.
I was happy. Hal, with a $12.50 profit, was happiest. This transaction, which
pleased everyone, had been illegal, of course. The law is an idiot. Again.'
You can find ticket scalpers like Hal at sporting events from Wimbledon2 to
the Super Bowl.3 You can find them at rock concerts4 and you can even find
them at Broadway plays in Moscow or at the Bolshoi Ballet.5
* Associate Professor of Economics, College of Business, Arizona State University.
** Professor of Finance, College of Business, Arizona State University.
1. Mano, Scalping, NAT'L REV., Aug. 28, 1987, at 37.
2. At the 1988 Wimbledon championships, a pair of tickets to the men's finals brought $2000.
Wimbledon Umpires Double-Fault, NEWSWEEK, June 27, 1988, at 37. At the same time, many
touts (as scalpers are known in England) were handed a setback as traders were fined,
jailed, and had their tickets held until the championships were over. Wimbledon Perestroika,
307 ECONOMIST 61 (June 1988).
The interesting aspect about ticket allocation at Wimbledon is that tickets are initially
allocated for nominal sums to members of closed privilegents. Those with little interest in
tennis are the ones who offer their tickets to the touts who then get them to the public. In
addition, the umpires at Wimbledon were discovered to be scalping their free one-half dozen
pairs of centre court tickets. The touts cried foul when the umpires demanded 800 quid a pair
for the tickets. NEWSWEEK, supra, at 37.
3. Super Bowl tickets have undergone markups ranging from 200% to 900%. Super Bowl XV:
Football's Little Bighorn?, SPORTS ILLUSTRATED, Jan. 26, 1981, at 31.
4. For example, during rock singer Prince's 1985 Purple Rain tour, tickets originally sold for
between $15.50 and $17.50 each, but fans paid scalpers as much as $5000 for two front row
seats. Nager, America's Biggest Ticket Scalper, ROLLING STONE, May 9, 1985, at 9. More
recently, Houston's Ticketron service was deluged with calls from irate parents whose children
were paying $75 a piece for U-2 concert tickets with a face value of $17.50. Pankay, Scalpers
Skim the Boxoffice Cream, VAITY, February 4, 1987, at 161.
One scalper commented:
On a rock concert you make more money than anything else. Those kids, their parents
give them $200 and tell them to get out of here. Kids'll pay anything for a rock-concert
ticket. Kid'll say, Let me go in the concert. When I come out you can kill me. They
say that.
Mano, supra note 1, at 37.
5. The highest priced theater tickets originally sold in Moscow for $18, but the scalpers' price
was $40. Moscow Digs Cats; Scalpers Get Busy, VArETY, May 25, 1988, at 1.](ViewImageLocal?handle=hein.journals/jleg16&div=6&collection=journals&method=preview&ext=.png&size=3)
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Assessing the Economic Rationale and Legal Remedies for Ticket Scalping
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