Ticket scalping a direct result of cheaper prices, economist says

Ticket scalping is a direct result of cheaper prices an economist says. Photo / Getty Images

Far from being a crime, ticket scalping is a market response to under-priced tickets, economist Dr Eric Crampton says.

His comments come on the heels of huge hikes in ticket prices on Viagogo for next year's Phil Collins Mission Concert.

"Concert ticket pricing is fascinating. It is hard to find any other area where retail prices are regularly low enough to cause shortages at the posted price."

The economist said we have to think about why it regularly happens with concert tickets.

"Part of the answer is that, for some popular artists, having a very enthusiastic crowd requires setting prices so that young fans can afford tickets instead of just richer old people less likely to stand and scream as the artists might want."

Tickets more than 10 times the original value for Collins Not Dead Yet: Live! world tour in Napier on Waitangi Day are still selling on Viagogo.

The tickets were sold through Ticketek and the Mission site and snapped up quickly in September. The ticket re-selling site, which has attracted much criticism, has general tickets going from $296, to $1840 for reserved seating tickets.

However, a spokesman for Viagogo said the tickets sold on their platform are "genuine tickets that have been sold on by the original ticket purchaser in good faith".

"Viagogo does not set ticket prices, sellers set their own prices, which may be above or below the original face value. Where demand is high and tickets are limited, prices increase."

Similarly, keen fans seem prepared to pay double the original asking prices of $150 General Admission tickets, with three online auctions for two tickets on Trade Me this past week reaching prices of $607, $655 and $621 respectively.

If fans aren't keen on the $150 GA tickets, a Napier-based seller is running a $1500 no reserve auction for three seated tickets. Fans also have a $2000 "buy now" option for the tickets.

But Crampton said this could all easily be stopped.

"I have a difficult time taking seriously complaints about ticket on-selling when venues could end it tomorrow, if they really didn't like it, by printing names on tickets at time of purchase and checking IDs at the door while checking folks' bags for contraband water bottles."

New Zealand Institute of Economic Research principal economist and head of membership services Christina Leung shared similar sentiments.

"I think the difference from on-selling another item (and hence why there is so much outrage) is the on-seller is profiting from re-selling a scarce good or service.

"The organiser of the concert has set a price based on what it believes is fair value for its fans, so for someone to come in and buy up all the tickets and then on-sell them at a much higher price means its fans cannot enjoy at an accessible price which had originally been determined by the organiser."