I don’t really understand the outrage over scalpers. Isn’t this just normal market behavior? Is a retailer that buys things and sells them with a markup a scalper?

People seem to be willing to pay crazy prices for events.

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rtpg 9 minutes ago | parent | next [-]

If reselling is allowed a market is created, pushing up prices. But that extra money doesn't go towards anyone involved in the creation of the product! It goes towards scalpers. Though there's a bit of price discovery value....

Without reselling scalpers have no reason to scoop up the tickets.

So if you prevent reselling... then concertgoers just have to do a lottery or something for the scarce resource and people who aren't interested in the concert have no reason to buy the tickets! Just a better experience for everyone except for the scalpers and I guess Taylor Swift cuz she won't know the price ceiling for tickets.

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Brendinooo 3 hours ago | parent | prev | next [-]

>Is a retailer that buys things and sells them with a markup a scalper?

If you bought all of the food then offered the food at 10x the prices, we'd be outraged with you, yes.

Stakes are lower because it's a luxury good, not food, but it's the same idea.

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bawolff 2 hours ago | parent [-]

There is a reason this doesn't work in general though.

If you bought up all the food, farmers would raise prices until either you couldn't afford to do that anymore or eventually there is a splurge of new farmers taking advantage of all your free money until you run out of money. It could maybe work in times of famine where the government introduces price controls or rationing; it does not work in normal times.

For black markets (which is essentially what scalping is) to work, there has to be some shortage of a good that is priced artificially low. It works with concerts because singers can only sing so much but they also don't want to make the concert so unaffordable that only millionaires can go. There are very few situations like that. In most industries you would just increase prices until supply equals demand.

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Brendinooo an hour ago | parent | next [-]

This makes sense, but I'd contend it's all the more reason for outrage: not only are scalpers doing what they're doing anyways, but they're destroying the (totally legitimate and sympathetic!) reason for "artificially" lowering the price to begin with.

I should note that outrage doesn't seem to land on the people who buy from scalpers, which is...probably correct? Seems easier to say "don't break the contract" to scalpers instead of fans who are just able to pay more.

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pixl97 2 hours ago | parent | prev [-]

Onion futures act.

This is the reason that businesses don't try to monopolize the food industry. It's not competition as we just saw from the egg industry. The government gets pushed back from the masses pretty quickly on food related issues.

	▲	gruez an hour ago \| parent [-]
		>This is the reason that businesses don't try to monopolize the food industry. It's not competition as we just saw from the egg industry. The government gets pushed back from the masses pretty quickly on food related issues. But you provided your own counterexample with eggs?

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sushid 2 hours ago | parent | prev | next [-]

It's not a simple buy/sell marketplace. There's no recourse for fans who purchase a confirmed ticket, only to find that the seller "doesn't have them" and see the same ticket relisted for higher if the price jumps. Stubhub prioritize these scalper relationships and doesn't meaningfully protect its buyers from getting screwed over.

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fecal_henge 3 hours ago | parent | prev | next [-]

The ultimate customers would certainly pay more than the face price which is what the scalpers pay, yet the scalpers get all the tickets. This is abnormal market behaviour.

	▲	brookst an hour ago \| parent [-]
		What’s normal? An auction would be the obvious solution, and I guess you could argue it effectively is an auction, just with initial sales that pretend to be a race and are actually sold to speculators who then run the auction.

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janalsncm an hour ago | parent | prev | next [-]

You are describing rent-seeking behavior: middle men who add no economic value yet inject themselves into transactions.

Yes, this is “normal” in the sense that it is common. It is “normal” in the same way that cancer is “normal”.

No, this is not “normal” in the sense of being behavior the government should just tolerate. It is in the same category of market failures as monopolies and externalities.

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brookst an hour ago | parent [-]

So is all demand-based pricing rent-seeking? Like selling gold or a house or any other scarce good for more than you paid?

	▲	Brendinooo an hour ago \| parent [-]
		I think that if you poke at the term "rent-seeking" with the definition of "middle men who add no economic value yet inject themselves into transactions", you'll just end up arguing about what "adding economic value" means. That said...if you can do that, you'll probably find that some additions of economic value are far more defensible than others, so it shouldn't all be flattened in the manner you're suggesting. I mean, scalpers add economic value, right?! They allow (wealthier) people who didn't stand in line at the right time to have a chance to purchase a ticket!

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andrew_lettuce 3 hours ago | parent | prev | next [-]

The outrage is over the apparent collusion between a platform that argues it only facilitates a fan-to-fan marketplace, and a hedge fund run by the platform's CEO that sells a massive volume of resale tickets. This is definitely not on the spirit of competition regardless of it's illegal or not

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sdthjbvuiiijbb 2 hours ago | parent | prev [-]

Yes it's rational market behavior. But it bothers people for such a blatantly worthless middleman to capture all consumer surplus for themselves while providing zero value.

	▲	pimlottc an hour ago \| parent [-]
		Which is to say, “perfectly efficient market” is not an end-goal in-and-of itself for most people