Ticket Scalping Case Study

Ticket scalping is an act of reselling tickets in the secondary market at inflated price. It occurs in many sports events, particularly in major rugby tournaments. Resellers (scalpers) will purchase heaps of tickets at one price and resell it at higher price due to excess demand in the market. This action causes outcry from the public. There are three main aspects to address and essentially propose a policy to curb ticket scalping, which are why and how ticket scalping arises, which party involves, and why original ticket sellers would price down ticket price.

Ticket scalping occurs when supply is limited, whilst there is excess demand in the market. In a major rugby tournament, the supply of tickets is limited because the number of seats available in the stadium is fixed. Meanwhile, there are many supporters would like to go to the event and support their team, where some are willing to pay more. The number of people who want to go (demand) is more than the number of tickets (supply). Thus, it creates an excess demand in the market. The original ticket seller (organiser), at this juncture, …show more content…
Premium seats are created for true fans, which are priced higher than usual (above equilibrium price) that the scalpers cannot take much profit from the price difference. Thus, it reduces ticket scalping activity and scalpers profit (Region B), meanwhile provides opportunity for true fans to get the tickets. The premium price is illustrated in Figure 2. Moreover, tickets are sold to specified name, which required present of identification to enter the stadium. Tickets can be resold with a transfer fee, if supporters change their mind for any reasons. The value of resell tickets drop and scalpers cannot make much profit from scalping, thus it reduces such activity. Therefore, these two strategies could help reduce the ticket scalping