What is the legal reasoning or logic behind scalping being illegal? I know it depends on which state you are in. I’m in Michigan so we can use that as an example. What business is it of the promotors what I do with a ticket that I bought? Isn’t that simply suppply and demand? If I bought a car for $10,000 that for some reason others valued and I sold it for $25,000 the car dealer can’t come after me?
Especially for sold out events. The promotors sold every ticket available and maximized their profit. Scalping sold out events doesn’t take money out of their pockets because they sold everything.
What about the technicality of selling something like a pen for $1,000 and giving 2 free tickets with the purchase? Can that stand up in court?
The event sponsor gets jealous that they did not get more money for the ticket. They typically can only stop you from re-selling the ticket while you are on the event grounds.
There are probably some differences depending on whether you are doing it a few times as an individual or many times as a business.
In general, people don’t like for re-sellers to buy up huge blocks of tickets before they get a chance to buy some good seats at face value.
Scalping is against the law because it prevents agencies from buying up a ton of tickets to an event specifically to make a profit. Ultimately, these practices hurt the original issuers of the tickets (in spite of the fact that many times, ticket issuers will HELP ticket brokers by saving primo seats or large allotments of tickets on the sly), and hurt the consumer, who in many cases does not have a fair shot to pay the fair face value on the ticket. While the laws were not put in place specifically to prevent you from selling that extra ticket you have at the event for a few bucks more than you paid for it, the wording of the laws make you just as illegal as the brokers.
I am not necessarily for or against these laws, I am just explaining the rationale behind them, which is what the OP asked.
Scalping laws aren’t just for the promoter, they also protect the ticket buyer. If there were no anti-scalping laws, there’d be nothing to prevent an agency from buying all or most of the tickets to an event, then reselling them at exorbitant prices.
Scalping is legal in some states, namely California. The only restriction is that you cannot resell tickets at the site of the event.
It is common practice here for ticket agencies or ticket brokers (their preferred appellation) to hire people to stand in line outside of arenas when tickets go on sale to buy up all the good seats.
Bribing ticket offices was a favorite tactic in the old days.
Except that people won’t pay “exorbitant” prices. If they do, then the prices aren’t exhorbiotant; they’re fair. There’s nothing stopping the theatre from selling the ticket at prices just as high as the scalpers do.
Say I own seats to a theatre. I want to maximize my proffits, so if I sell the tickets for $100, no one will buy them, but if I sell them for $1, I’ll never make a profit. If I sell the tickets at an optimal price, (say $42), then I’ll maximize my payoff. ($43 would be sell too few tickets, $41 would net me less money.) If a scalper buys up my tickets and tries to sell them for $60, he’s out of luck. He’ll never recoup his investment; if he could, I would have sold them for $60 myself.
Now say I’m not too savvy. I sell the tickets for $20. The tickets are undervalued. So when a scalper buys up 50 tickets and sells them for $42, the optimal price, he’s just helping the market reach an optimal price. He’s finding an undervalued asset, buying low, and selling high. What’s unethical about that? Whether the theatre or the scalper sells them to the customer, they still have to sell something at a price that’s acceptable to both parties.
First off, I’m from California and I though scalping was illegal even when NOT at the site of the event. In fact, the scam you see here is a guy holding out a bunch of tickets with a sign that says “I NEED tickets” rather than one that says “I HAVE tickets”. The other thing to think about with scalping as a problem, is that an agency that re-sells the tickets is (usually) a semi-reputable business. That is, they aren’t selling you a nice color xerox of a ticket printed on card stock like the asshole on the street corner might.
Allowing scalping means only the rich can see the event. It sets up a bidding system that effectively squeezes out anyone who can’t afford the scalper’s price, but who could afford the listed price for the ticket. It sets up a bidding system, and bidding systems force people to overpay.
In addition, scalpers would quickly buy up all the tickets and prevent anyone from getting them for the price set by the promoter.
“What we have here is failure to communicate.” – Strother Martin, anticipating the Internet.
Scalping is also potentially detrimental to the consumer.
We were going to the theatre in London, a few years ago. Ahead of me in line was a chap who had paid the equivalent of about USD 120 for two tickets from a very nice gentleman outside the theatre, who said he had two tickets that he couldn’t use. Turned out the tickets were forgeries, worthless. The sucker was just out of luck. (Actually, from what he said, the scalper didn’t lie – he said he had two tickets that he couldn’t use. Fair enough.)
So scalping is at least partly illegal as a protection for the gullible.
Well selling Jaguars for $50,000 only allows the “rich” to drive them. If people value a venue enough to be willing to pay $200 for a ticket, then so be it. That is the free market. If your not savvy enough to get the ticket at list price then your out of luck.
I understand the forgery issue, but I’m just talking about reselling the Ticket in general. I see nothing wrong with somebody having an extra ticket and wanting to sell it, even at a premium.
In Michigan, it is legal to resell tickets. Only you can’t do it on the grounds of the venue and you can’t have an office or established business presence.
Several points have been touched upon which, together, seem like a good reason to illegalize scalping.
If a few scalpers are allowed to buy large numbers of tickets and sell them at a higher price, they have effectively altered the supply/demand feedback that normally regulates prices in a manner beneficial to both the producer and the consumer.
In other words, they artifically restrict supply at the box office window to increase the demand on the streetcorner.
If the show would’ve sold out on its own, the theatre neither wins nor loses. Some consumers are driven away by the scalpers’ prices (loss) or pay those higher prices (loss).
It also seems likely that scalpers are not (even when it’s legal) going to report that income to their state or federal tax agencies.
“Don’t steal: the government hates competition.”
I lead a boring life of relative unimportance. Really.
Ah, yes. The old “free market solves everything” argument. The equivalent in intellectual naivete as the “Marx solves everything” argument. It’s amusing that those who condemn communism are so often willing to use the same muddy thinking.
There is a concept, now often forgotten, of the “common good.” In other words, you do something that brings the biggest benefit to the largest number of people. Banning scalping benefits everyone who wants to buy a ticket – even those who could afford the scalper’s price. Allowing it only benefits the few that scalp tickets. So on a purely philosophical basis, scalping laws are a good thing, since more people benefit.
“What we have here is failure to communicate.” – Strother Martin, anticipating the Internet.
I’m not saying the free market “solves anything”. I’m saying it is the only fair way. We live in something called a “free” country and freedom should come before any “common good”.
It would be in the “common good” for resturants to be forced to give free meals for everybody since the only people suffering would be the owners of resturants and everybody else would benefit by getting free food. So that philosophy is just as “muddy”.
I’m just going with simple logic here. Why is it illegal to resell some things above listed value and not for others? There are no laws restricting the reselling of retired Beanie Babies or Pokemon cards.
Is it not illegal to sell ANYTHING without a license in most states? (Of course, this means that Flea Markets and EBay are technically illegal, but lets not split hairs).
One question: Who collects the sales tax from the Scalpers?
“Shoplifting is a victimless crime. Like punching someone in the dark.” -Nelson Muntz.
I am with quadell on this one. Free market is free market and I cannot see why it would be the government’s business to insure poorer people can see the event. In any case, they do not limit the price the organizer can charge, only prohibit reselling.
The only valid reason would seem to prevent fraud as it is easy to forge tickets.
Some years ago, here in DC, there was an exhibition of gerogia O’keefe’s paintings at the national gallery and the tickets were free except the demand was so incredible that you had to stand in line for two or three or more hours to get a couple of tickets.
Technically it was illegal to resell them or to pay someone to stand in line for you and I find this just plain ridiculous. If the national Gallery wants to charge admission, that is their privilege but if they want to give the tickets away, thenthere should be a free market for those tickets.
If a lawyer whose time is worth $200 an hour wants to pay a jobless man $40 for the tickets, what is wrong with that? They all come out ahead.
The only rationale that I can find against scalping is that vendors are required to have licenses and abide by certain rules. Maybe they should be regulated but I cannot think any reason for making it illegal.
Soccer, as you know, attracts a hooligan element ,so ,to segregate the fans ,tickets are allocated in a way that ensures that supporters of one team only get to spectate with fellow fans.
This is done by issuing supporters club registration passes, without one you can’t get a ticket.If you misbehave your pass is withdrawn.
If touts block-buy tickets they will sell to anyone who will pay the asking price making a nonsense of the segregation rules.
Fortunately ,and despite what your media may report to you ,soccer violence has diminished hugely and now famlies are turning up to games.
Touts come in all types from the overweight shell-suited geezer to the posh-accented posh nob running a ‘corporate hospitality enabling’ agency.
If anything the the latter are disliked more the the street corner types because they seem to get access to tickets against all the rules of fairness and their clientele usually have only a passing interest in the game and it denies the true fan his pleasure.
