Critics of the ticketing industry should focus their ire at the “initial allocation of resources” rather than the resale market according to a major think tank.
Mark Littlewood, director-general of the Institute of Economic Affairs, described critics of the secondary sector as “misguided” in an op-ed in The Times newspaper. He further suggested that politicians, namely Sharon Hodgson MP, display an “inability to grasp the key economic concepts of scarcity and value” in their opposition to ticket reselling.
Littlewood, who leads the free market think tank, questioned whether the 10-per-cent price cap suggested by Hodgson and others should apply to additional sectors. He illustrated his point by deliberating on whether a cap should also be applied to those with the first issue of Action Comics – the home of Superman – which would have cost 10c in the 1930s but is now potentially worth $3m at auction.
“Sadly, as is so often the case in modern political and economic debate, too many people are prone to focus on criticising a system of trading when their real beef is with the initial allocation of resources,” he wrote.
“Perhaps too many FA Cup final tickets are initially given to major corporations. Perhaps poorer people should be given a certain number of free tickets to the theatre and the opera. However, once properly allocated, it would be perverse to prevent or limit further trading.”
Price cap legislation was recently introduced in Ontario, Canada and New South Wales, Australia.
Littlewood’s piece coincides with the latest sale of tickets to see the Broadway smash ‘Hamilton’ in London. While many have argued the inflated resale prices for the show are unfair, Littlewood believes it simply a case of supply outstripping demand which cannot – and should not – be solved by regulation.
He said: “It is folly to believe that the face value of a ticket somehow reflects its intrinsic, objective value. As with all other goods and services, a ticket is worth whatever someone will legally pay for it. A rare chance to see my beloved Southampton FC play at Wembley may not be worth the £90 asking price to the overwhelmingly majority of people, but it is worth it many times over to me.”
IMAGE: Wes C/Flickr