I remember trying to explain to my Swiftie cousin at Thanksgiving that you can't really complain that Taylor Swift concert tickets were simultaneously too expensive and also too hard to come by.
Normies seem to be incapable of thinking about real (rather than nominal) effects. I was briefly in the US during the Eras tour but even from overseas you could tell that many millions of hours were spent hunting down tickets. It's just not a productive way for society to operate. Similarly 'affordable' housing schemes that lead to small industries whose entire function is getting access to the under-priced real estate.
Our moral intuitions are about a world where we know everyone, more or less, and passing out goods like the Big Man of a tribe is a plausible way to do things. You can see this on display in Cohen’s “Why Not Socialism?” You’d never charge a friend during a camping trip. But the fact that they’re my friend is doing a lot of the moral work: I know them and have a certain level of trust.
In the broader economy, I don’t know you, trust is mediated by institutions and norms which shape expectations on both ends of the relationship. (You can’t even trust the trustworthy, after all, because trust is about mutual expectations!)
If Taylor Swift could psychically assign tickets based on things like dedication, need, and so forth she could underprice them without problems. As it stands, we have to proxy for that using willingness to pay. And that, itself, goes off the rails because the marginal value of dollars declines rapidly after a point.
Which really just indicates a moral argument for redistribution: it makes our actual universe more like the imagined moral universe.
"Once we smash capitalism, people will of course just realize that someone else could make better use of their Manhattan apartment and gladly move to McCook, Nebraska to pick beets on a collective farm."
There’s a difference between Taylor Swift tickets, which no one needs, and housing, which everyone needs. Do you also think scarce medical resources should be allocated based on price rather than need? I’m 100% with Matt on restaurant reservations and concert tickets, but I also like to be able to walk down the street without tripping over homeless people. Of course affordable housing requires a certain abundance, just setting aside a few scarce units for “workforce” or low income families doesn’t help.
I suppose in general 'affordable' housing schemes don't seem to achieve anything or indeed be actively destructive (because they lower housing supply), and so the resources would be better spent increasing housing supply. There may be exceptions for people with special circumstances such as addiction.
Medical care is more challenging because patients lack the information to make their own consumption decisions. But typically what happens is an expertise-based allocation system. It's not whoever logs into the hospital's website first gets the care.
There are multiple different housing problems going on in many cities, there are (a) lower middle class working folks who can't afford housing that can be rented or purchased at a reasonable percentage of the median income in their area; (b) there are people who are low-income because of an inability to work-full time usually do to disability, the need to only work part-time or not at all due to caregiving for children or elderly family members or who lack sufficient skills to get regular employment. This group also includes a lot of people with low level behavior health issues involving addiction or mental health; and (c) There are people with severe behavioral health and mental health issues who require full wrap around services including with stable housing and or need to be housed in less traditional transitional housing until they are more stable. This group would include most of the chronically homeless populations in many areas.
All of these groups are helped to some degree by simply greatly expanding housing supply so that sorting allows for housing costs overall to be reduced. In many cases that alone would address group A but group b and c are probably always going to require some level of housing subsidization and group c is going to require intense subsidization. Group C is probably always going to be better served by housing built and run by governments and non-profits. But Group B could be helped by their being incentives to building subsidized units in new buildings. I think the issue is whether this is achieved through incentives like reduced design review or priority permitting or whether they are imposed as additional burdens on market based projects. In my own community it is the later in part because of state constitutional limit on taxing that create the need to "fund" mandates through these restrictions that could be better funded in different ways.
"Do you also think scarce medical resources should be allocated based on price rather than need?"
The entire point of government-provided health insurance ("Medicare for all") is that it simultaneously allows hospitals to allocate scarce medical resources based on price, without denying needed services to people.
If you want most people to live in publicly-funded housing, then that's a perfectly fine opinion to have (I hear Singapore operates so). But public housing isn't a magic wand: you've just shifted the problem from "restrictions on housing supply mean people don't have enough money to pay rents" to "restrictions on housing supply mean that local authorities don't have enough money to buy properties to rent out".
"The entire point of government-provided health insurance ("Medicare for all") is that it simultaneously allows hospitals to allocate scarce medical resources based on price, without denying needed services to people."
Government provided health insurance absolutely determines when it's no longer cost effective to provide potentially needed services to patients. In fact explicit rationing is a hallmark of many of these systems, internationally.
One example of allocating scarce medical resources by price is that we could have auctioned off when you got your COVID vaccine dose, rather than having eligibility classes that determined place in line. Someone who is very at-risk but doesn't mind isolating for another month would probably be willing to pay less than someone who is less at-risk but desperately wants to return to social life, for example.
And there's no rule that bids in this auction would have to be out-of-pocket; insurance companies that expect to have to pay more to treat patients who are more at-risk would want to bid higher on them getting the vaccine sooner.
[This also would have led to less waste--the system acted as tho it was better to throw doses in the trash than let anyone jump the line, which is obviously not true from a public health perspective.]
Honestly, here in LA most folks we knew that wanted tickets has no trouble getting them (there were a lot of shows), and the markups were only mildly awful.
Here in Philadelphia I know people who attended an exuberant listening party held outside the stadium while the concert was underway. They described it as tons of fun and free with the exception of the mass transit fare.
Did Swifties believe that going to the concert was, what, 500 times more enjoyable than going to the Eras Concert movie? I suspect that with all costs considered, that's not an unrealistic ratio.
Having done both, yes, attending the concert was probably worth like 2000x more than seeing the movie. It really was a once in a lifetime experience - which is a term that gets tossed around way too often, but this kinda was that. And frankly, the frenzy/scramble to get the tickets was sort of part of that experience, part of the hype/anticipation.
In addition it to it being a special communal experience, two things that also made it very much worth what I paid (in full disclosure, I was one of the lucky ones who got face value tickets, I didn't pay resale prices) are that 1) she really is a fantastic performer who makes every single show feel like the most special show you've ever seen, and 2) unlike sports games I've bought expensive tickets to due to them being a once in a lifetime-type experience, it was basically a 100% guarantee it was going to be a great show, whereas sometimes a sports game (or a fancy restaurant meal you order) sucks. And even with concerts, there are bands I love whose live performances are just fine, whereas Taylor really is extraordinary at the live performance, plus the crowd/atmosphere takes it to the next level.
So I'd say yes, the Swift tickets were absolutely worth a ton more to see live than to see in movie theatres - but I don't think the current market-clearing price of an NHL playoff game in Boston (~$250+ for cheap seats, a rent or mortgage payment for good seats) is worth that much more than watching it on tv.
In my opinion, hockey in a well designed arena is the best in-person sport. Even the worst seat in the arena can be great. Football is interesting because up close you see tactics and further back (upper deck) you see strategy. Basketball, you see neither. And baseball, well, it's baseball.
I agree with this, which is why I a) usually buy upper deck seats for hockey and b) historically always would try to buy tickets to go to playoff games. The prices have gotten to be too much for me though. I go when I can buy tickets at cost via my season ticket holder share - I won't pay resale prices.
I'm not a Swift fan, but personally, going to see my favorite team win a championship in person would be 500 times more enjoyable to me than watching it on TV, if not more. I think there's a case to be made that in an era where every digital experience is available anywhere at any time for almost $0, scarce in-person events are only more valuable.
I would agree with this, though of course when you pay the price there's no guarantee you're actually going to see them win. Of course, if there was a guarantee, it wouldn't be as fun! The conundrum of sports fandom...
Related to Matt's point, when the Vancouver BC Winter Olympics released tickets both my husband and his best friend put into the lottery to get potential tickets to every game. The odds were so bad that they figured this way they would get to see at least one game. But there was a "hockey miracle" and they both got two tickets to almost every game including my husband's two tickets to the gold medal game. Because the lottery required you to give your credit card up front and agree to buys if you won this meant that our families now how had and combined "investment" is more than $30K in Olympic hockey tickets. The quoted language being very much part of the pitch they each made to their spouses to try to spin this into an "exciting opportunity" rather than an unapproved $15K expenditure of family funds. They actually did end up being able to sell all the extra tickets so that they could each go to each game for "free" since the resale price of the extra tickets covered the whole cost and they slept in the basement of my husband's best friends cousins. They felt it was totally worth it. But I imagine the folks who paid them well over face value to allow that would have preferred to just pay that directly.
I was worried when I saw triple digit comments when I woke up, this didn't seem like that controversial of a subject to Slow Borers. Just a highly engaging one instead!
I genuinely don’t understand what happened here. Like it doesn’t feel plausible that Taylor was 10x as popular as she was on Rep and 1989 tours.
Like I would bite the bullet and pay but it feels lousy, and the demand side to concerts feels unrelated to the level of fame people have. Acts who aren’t even household names are commanding several hundred dollar nosebleeds.
It's over determined, but I do think the broad age cohort has a lot to do with it. I recently saw Bruce Springsteen after paying Ticketmaster a ridiculous amount of money. An amount of money that would have been unthinkable to my 40 year younger self the last half dozen times I saw him. But back then the demand was strictly people my age. I didn't have to outbid upper middle age, upper middle class members of the PMC --- like me today. It was also true that no one sixty years old (me today) would have gone to anything like a rock concert. Add that to the general prosperity that Matt listed, and you really have a recipe for demand with very little meaningful price ceiling.
It'll be really interesting to see how many of these legacy acts will be able to sustain those kind of prices in the future, with music fandom being so much more dispersed these days.
I also think the fact that people don't "pay" for music the way that they used to and acts can't rely as much on that revenue is a big part of it. Concerts used to be viewed in large part as marketing for an album. Now it is like the album is the marketing for the concert.
Now we need an article about how expensive concert tickets and declining sales of new music are both the result of music creators failing to create fresh, sufficiently novel genres of music that kill off demand for prior genres and create generational divides in listenership!
Michael Jackson and Madonna were maybe as big, the Beatles were bigger, Elvis was maybe as big... and that's it in terms of the whole history of recorded music I think? She's in a really exclusive club.
I feel like there were a fair number in the 80s and 90, U2, Bruce Springsteen, Madonna, off the top of my head, but she and maybe Beyonce are sort of the last thing like monoculture in music. I suspect the cowboy Carter tour will command somewhat similar levels of attention.
Beyonce will assuredly sell out, but I don't think the Cowboy Carter tour is going to live in the cultural zeitgeist the same way the eras tour did. Mainly, because the eras tour hit so many different generations at once.
I don't think the three acts you mention had anywhere near the "17 year olds with their 40-something parents" vibe to the extent Swift does. Not even close. Not three or four decades ago, in any event. Sure, if those acts are touring *now* you'll get cross generational fan representation.
Exactly. The fact that I one-thousand-percent don't care about contemporary music and still know Taylor Swift is a big deal is just like my parents realizing in the early 80s that Michael Jackson was a big deal.
Because Swift released two lockdown albums that massively expanded her fanbase by being stylistically different from her country and pop work, and the new fans they brought in were both older and more male than her previous fans.
America being unbelievably rich in historical terms + having access to endless digital content at home makes demand for special in-person experiences even greater (is my hypothesis at least)
Remember we USED to spend tons of money on recorded music. Now that's dirt cheap. Ergo, there's tons of money to spend on concerts (and even more to spend coming right out of the pandemic).
I think this was true in 2018 and Beyonce and Taylor were plenty famous back then and one ticket went for less than I paid to see Olivia Rodrigo, who I think is objectively far less well known than Tay and Bey in 2018. All of this was on Seat Geek so no Ticketmaster luck.
I don't know if she's *10 times* as popular, but she's definitely a lot more popular post-pandemic thanks to Evermore and Folklore, AND her earliest generations of diehard fans are now fully into the workforce with considerable disposable income.
The second idea is something that I was kicking around too thinking about this as I drove to work. The ten times the price really is hard to get my head around. 1500 dollar nosebleeds isn't something I can imagine being sustainable for live entertainment.
Taylor is more popular than she was during rep/1989, her fanbase is older and has more disposable income than it did then, America is much richer with a much larger leisure class than it had during rep/1989, AND people with money put more value on these kinds of experiences than luxury goods compared to past generations of rich/upper middle class people... being able to Instagram being at a Swift concert or seeing Messi play or flying to go see the eclipse is the new status symbol in the way a fancy car or whatever might have been for others.
She is a lot more popular now. Even I, a middle aged woman, can't get away from people talking about her. Luckily, my kids aren't into her, or it would be non-stop.
This comment section is mostly men. Taylor Swift fans are mostly women. I get the impression some men don't realize how many women and girls love Taylor Swift, because they don't spend a lot of time talking to women and girls, and following women and girls on social media.
I agree there's some status competition element of this, but I feel like you're pushing this view way too hard.
Do you have kids? I have teenage daughters and one of them went to the Eras tour (for free!). It's hard to capture or express what it meant to her, but I promise that status competition was only a small part of it.
You can buy a car that costs 10 times as much as a new Toyota Corolla. It will be a better car in a lot of real ways, and people absolutely exist who would pay that premium specifically just to enjoy the additional real features, not thinking at all about status.
I think it is still the case that the price of expensive cars is heavily influenced by car buyers who do care a lot about status.
I’m sure Eras is better than previous Swift tours, maybe for some ticket buyers, even enough to pay 10 times the prior price. But my guess is that 10 times higher ticket prices also have a lot to do with the social value of attending, for the marginal ticket buyer.
It's my impression that the "social value" of going to a Taylor Swift concert is mostly about the social experience, rather than status. Women and girls dress up, they trade friendship bracelets with others while they wait outside to go in, they bond with strangers in their sections at the concert. It's about a shared experience. This is also why "save up the money and go to a foreign country to watch Taylor Swift" is not a good substitute, for most attendees; it wouldn't be the same thing.
Absolutely, and sports fandom is not much different. For sure there are plenty of people who spend a ton of money on going to a big sporting event because it's a status symbol, they can Instagram it, it's cool to say I was there, etc.
But I'd say for most people, the opportunity to potentially be at an event with a rapturous crowd, with a shared experience that everyone there is going to remember and talk about for the rest of their lives, and thousands of people watching on tv wish they could have experienced live, + the bonds that get formed going to these games with family/friends etc is worth something that can't really purely be calculated economically - i.e., is my $500 Bruins playoff ticket 50 x more valuable and enjoyable to me than paying $10 to go to a minor league game.
"I think it is still the case that the price of expensive cars is heavily influenced by car buyers who do care a lot about status."
Conversely: how many people honestly do enjoy the features, and just use status as a proxy for quality to avoid having to check Consumer Reports when purchasing?
So, you're saying that we may actually be at Peak Swift and it would be wrong to project that, by the year 2030, 25% of US GDP will be Taylor Swift concert tickets?
Thankfully, my Swiftie sister did not balk at the prices. Instead, she wanted me to give her tips on how to get them, since I've purchased plenty of music concert tickets in the past. I just bluntly told her: "Good luck, I got nothing for you.".
Same with Disney parks fans. They want cheap admission and short lines. Only way to have both is with a lottery system or tickets selling out immediately like concert tickets do. Most people get this, but there’s always a few who insist it’s just “corporate greed”.
Matt hits on some interesting points, but I think he’s unaware of economists’ actual theory to explain why some restaurants/concerts/events/etc are persistently underpriced (sell out immediately).
These are what Gary Becker called “social goods”. Plays and restaurants are more fun to go to when they’re perceived as trendy. A big line at a restaurant, or an immediate sell out of tickets, is a signal of trendiness. So sellers of social goods deliberately underprice. If they try to increase prices, they risk falling out of fashion. E.g., if Hamilton increases prices so that markets for tickets will clear, it no longer sells out. Then maybe Wicked becomes the popular play instead, and no one wants to go to Hamilton, leading to empty seats.
(It’s been recognized for a long time that the arguments Matt points out for underpricing don’t make sense. However, upon further inspection, Matt’s take that it’s bad norms/irrationality doesn’t make too much sense either. For example, why didn’t Hamilton increase prices very gradually over time? That probably wouldn’t have been noticeable enough to upset people. This phenomenon also happens for watches/luxury cars /etc. for which it’s definitely feasible to increase prices over time. Overall, I’m really skeptical that Matt just solved a problem that would increase profits for sellers around the world!)
I accept the point that there are things that are more fun to go to when they’re perceived as trendy, but there's surely some median between killing the hype and selling out all the venue tickets in three minutes followed by resellers flipping them for ten times the face price.
Yeah, this is a good point. One of the subtleties of the “social goods” theory is that demand can be very fragile: a small price increase may cause the good to immediately fall out of fashion.
(Of course, I haven’t said anything about whether this is empirically plausible — it’s just a theory that I wish the article had discussed. I recently discussed a paper that tests the theory in the NFT market, and it seems to work there. But more evidence is needed.)
See, I can believe that, but at the same time the "sellout" process itself was a social event: giant lines around the venue with people camped out for days or weeks and such got a lot of free media attention and helped build fanbases in the pre-internet era. I'm very skeptical that the modern "sellout," which consists of sitting at one's kitchen table at home with a locked-up website and a phone with an automated voice saying there are delays due to high call volumes, generates the same sort of marketing benefit.
I'm not so sure about chik-fil-a. At least at the closest one to me there's sometimes a big line but they also work pretty hard to get that line cleared - having 2 people standing outside taking orders instead of using the drive-through speaker box so they can pre-fetch everything.
On one level, I agree with you, but this is not so different than surge pricing or price gouging (both of which generate significant backlash). My guess is that both factors are in play.
Speaking of Hamilton, I do think Broadway is actually overpriced right now. Demand is lower than a few years ago while supply of new shows has risen but ticket costs have gone up significantly. I read an article that part of that has to do with an increase in production cost and need to make up for the lower demand but that also seems like a recipe for show closings (which is what happened to a lot of shows in a very competitive environment for show openings this spring).
I don't think Restaurants even need to charge for tables per se - they should just take a deposit? I find it nuts that restaurants will usually book out tables when a reasonable proportion of people will just not show up, which is obviously wasteful and costly to the restaurant. Taking a deposit, which is taken off the bill at the end, is a fairly easy way to fix that problem - and in my experience already used at times of high demand (e.g. Valentines Day). Taking a deposit would presumably also dampen the trading of reservations?
There are restaurants that do this. Several reservations I've made recently (I think on Resy) asked for my credit card and warned of a 'no-show' charge. Can't remember now which restaurants, but it wasn't around a specific date--it was just a general policy.
You inevitably get into a lot of nasty fights and bad reviews with customers over this. "But I got sick! You want me to come in sick??" or "My grandma died and you want to charge me!"
And even if you want to make exceptions for these, the viral LPT that goes around - "want to get out a BS restaurant fee? Tell them you're sick!" means you have to try to actually discern who is telling the truth. When you get it wrong 1% of the time, that 1% turns into a viral boycott.
somewhat related: I really wish Yelp and other review sites would separate ratings for "service" and "food." Many restaurant ratings are driven by people angry at service issues (which most people don't care much about), so it's hard to determine who has good food (which most people do care about.)
Yelp reviews are the worst! One thing that makes them crappy is that most places also have "unreliable" reviews that are hidden until you request them and that don't go into your overall rating. These reviews are often determined to be "unreliable" because the reviewer only or almost only gives good reviews.
People who advertise on Yelp can "elect" to have their "unreliable" reviews show and be included in their numerical rating system. So Yelp basically emphasizes the bad reviews for anyone who isn't paying their advertising fee as a way to blackmail folks into paying for the service. I regularly get emails from them pointing out that I would have a much higher score and have many more positive reviews shown if I advertised with them. As it is I have about 5 reviews that are 5 star and 1 review for 1 star from an utter nutjob pissed off that I had to reschedule a free consultation that I had offered her because of a parenting commitment who complained that prioritizing family over potential clients is okay for a mom who sells cupcakes but not an attorney. However, I have 12 5 star "unreliable reviews" that are currently effectively hidden that they could add into the mix. I have more work than I know what to do about right now (trying to figure out the pricing ethics of this with an in demand but necessary service) and frankly I think that 1 star review has probably gotten me more clients who are working moms and find it offensive than it has lost me. But the overall system in corrupt in my opinion.
Really, that could be dealt with simply by including a cut off time for cancellations, like when you reserve a hotel room and get charged for the night if you don’t cancel by a certain date or time. If you get sick or someone dies, you cancel.
Agreed. 2 places I can recall not refunding my money when I was sick and I don't ever want to go to those places again. If it were a non-refundable deposit (10-15% of the outing) I probably wouldn't have minded, but it was the entire price.
(EDIT: Neither of those places would easily have been able to find a replacement for me, presumably unlike a restaurant and walk-ins, so I kind of understand but not enough to want to use them again)
It's a real dilemma. I'm not sure what the right answer is even if someone is honestly sick, but it's impossible given that anyone can claim they're sick. Airlines have the same problem.
Charging the whole price, vs. a deposit does seem excessive. Then again, restaurants are a tough business. If someone has to lose $300 for a cancellation, I'm not sure it's fairer to ask the restaurant owner to eat it vs. one of their typically-well-off patrons.
Between no-show penalties, ID checks (to prevent reservation trading) and peak-time charges, restaurants have quite a few tools to manage this problem.
ID checks would seem the easiest. Aren't happy hours sort of reverse peak-time charges. My family eats crazy early and we always get happy hour specials.
I have been to a few places that implemented such a policy.
It got tricky when I had to void the card I paid with (because it got stolen) before going to the event. Now I can't verify because the credit card numbers aren't the same.
This was my thought - anyone smarter than me have thoughts on how this market function (hefty deposit that's taken off bill at end of night) vs the pure pay for reservation market? What distortions could occur in the deposit system that don't appear in the straightforward pay for reservations market?
Deposits exist to solve the problem of people not showing up. So a restaurant with flaky customers might use a deposit system. But if your customers always show up, the deposit is irrelevant.
A pay-for reservation system serves as a way to price discriminate against those who want to eat at busy times. If you want to go to the restaurant for lunch on Wednesday, you’ll pay a lower price than dinner on Saturday, since you need to pay for the Saturday night reservation. This is useful even if you know 100% of customers will show up for their reservations.
I think they're to create friction from trading the reservation as well. So you get a smaller secondary market for reservations. Like the secondary market can still happen but it's like PayPal to some random person you don't know rather than sell in an apps' created market. Could be wrong tho.
I see both improving the situation around reservations getting snapped up fast. Why wouldn't a sufficiently expensive deposit work the same as a market clearing reservation price?
It's true that as long as everyone will skip their reservation with positive probability, then setting a sufficiently high deposit will clear the market (since a $10k deposit, e.g., would be too much for most people to risk losing).
Nevertheless, the two schemes still differ in their allocative effects. When you use deposits to clear the market, you're selecting in favor of the least flaky customers. When you use a reservation fee, you're selecting in favor of those who value eating at busy times.
Deposit fees are more efficient when the main problem is too many reservation-happy customers who don't show up. Reservation fees are more efficient when the main problem is too many low-value customers showing up at busy times.
Interesting and related aside...Where I live there is an outdoor amphitheater on a river. Across the river is a restaurant with outdoor seating. On concert nights in the summer the restaurant lets you book a table with a $400 dollar purchasing minimum on nights with popular concerts (you can hear from the restaurant). The money is like a deposit but goes toward purchases (so you have to spend $400 minimum).
I have not done this yet but plan to. A friend told me about it and had a great experience.
Beat me to it, this was my idea that was percolating in my mind ever since Matt tweeted the thesis of this article out 9 days ago. It elegantly solves the problem of vendors that want to give their customers a good, below market price, but have to clear the market or else rent seeking middlemen will do it for them.
This was not a good day for me to be a person experiencing Westernness and already seeing triple digit comments when I woke up. I should have done what my fellow Boisean Rory did and go to Argentina.
Wenty to a hip place for anniversary last week and they had a like $25/person no show fee on the reservation. They also confirmed with us like 3 times.
Downside of deposits for reservations is reservations are less movable, ig you could half or quarter the charge/deposit for cancelations +12 hrs in advance or something. Like if you always get charged seems more likely that someone just no shows rather than cancels with notice.
I was literally sitting here in Argentina refreshing waiting for an article so I could post early. And I get restaurant reservations. I’m not a foodie, and I live in Boise, where reservations aren’t a big deal.
But I do work in New York City occasionally; usually on short notice. So if I could pay extra to get a reservation at a good restaurant if I needed, I would appreciate it.
Capitalism is good, so are market forces.
Also, the Food in Argentina is overrated, but the tomatoes are delicious. Why can’t we have tomatoes that taste like they taste here.
On a Taylor Swift note, My wife paid $6000 for three Taylor Swift tickets in Los Angeles to take her daughters. The whole trip cost 10,000, since she had to fly them from Hawaii and Boise. She said it was worth every penny, for the concert and spending time with her daughters.
I moved in 2021, went from bumper crops of three different heirloom varieties to dust bowl like outcome where I currently live. I'm in for more compost, more tilling, and anything else I can think of for this year. there is no substitute good.
Can't find it now, but there's been a lot written how American supermarkets select for uniformity and color over taste, leading to generally bland tomatoes even though much tastier varietals are available.
I have a friend who spent a month in Italy, and he said the same thing about the tomato’s there. Comparatively, tomatoes in the US taste like cardboard.
Green zebras are pretty good too! As are Sungold cherry tomatoes.
When I moved to DC in the 90s from Boston/Michigan, I quickly became a winter softie. But I never (and to this day haven't) adjusted to the summers. My only consolations during the scorching season are tomatoes and peaches!
In the US, you can get decent local tomatoes in places with good climate and soil for them. Like New Jersey (seriously).
But the best tomatoes I’ve ever had were in Egypt. Deep red, sweet, and incredibly rich flavor and dense texture. Just unlike anything else. My brother, who refuses to eat raw tomatoes anywhere else, happily scarfs them down in Cairo.
Is this still true? Whole Foods has pretty good tomato selection year round, and funky-looking heritage breeds in the summer. Are there better tomatoes than that elsewhere?
On the Tomatoes point, I kind of like you can only get some delicious things in certain places. I’ve never been to Argentina but, if I do go, I’ll be sure to try the Tomatoes.
When I was in the Philippines recently I had Mangos on Gimeras Island off the coast of Ilo Ilo city. They are insane, like another level of Mango that truly does not exist anywhere else. I’m sad I can’t get them here in the US but it does keep me looking forward to traveling back there one day.
My girlfriend will basically refuse to eat Mangoes (despite loving them) in the US for a while whenever she returns from visiting her family in India, because they simply don't compare. I haven't had one yet and I cannot wait.
Mangoes and papayas are delicious if you are eating in a tropical country that grows them, but consistently repulsive when you buy in the US, no matter the country they’re grown in. The ones shipped here aren’t allowed to ripen enough before being picked.
Summer camps, after-school care, and kid activities are another big one where the prices are reasonable but scarcity high. In Boston area if you haven’t signed your kid up by January then enjoy the wait-lists.
Ataulfo/Champange/Honey mangoes are pretty good and show up in US supermarkets seasonally.
People I know from mango-growing countries will get into fights over what the *best* kind of mango is, but they're generally happy to agree that ataulfos are second-best.
(the Tommy Atkins ones that US markets usually carry do not make the list at all).
>Why can’t we have tomatoes that taste like they taste here.<
Rory: Long time no hear!
I remember reading once that US produce supply chains prioritize uniformity, coloration/appearance, and 12-month availability. And that as a result, taste sometimes suffers.
Barbacoa could have easily been the pioneer in charging for reservations, but they have wisely instead increased their supply with a new place in Eagle and somewhere else.
And I'm liking the tomato discourse here, I don't really dig fresh whole tomatoes that much, and now I might have a reason as to why.
Yeah, Barbacoa is definitely a place where you're paying for the ambience as well. And the Caldwell place I think you're thinking of is Amano, I still need to go there some time.
I’ve never paid for or watched a boxing fight in my life.
My best friend and I are huge sports fans. When we get together, it’s most often at aa sports bar. Lately, it has been watching NBA playoffs, but it has also included NCAA tourney games, NFL and MLB games over the course of our friendship. But never once have we decided to watch a boxing fight nor has it ever crossed our minds to pay for a fight; even the biggest ones. And we’re definitely the type of fans to watch Kentucky Derby, watch last hour of the Masters or US open final. In other words, even sports were not huge fans of, if the event is big enough, we may watch.
We’ve both agreed that the biggest reason we’ve never watched boxing is the Pay-Per-View model introduced in the 80s. Combined with the fact the biggest fights were in Vegas and started at midnight east coast time, it just was never in the cards for us to watch anything as kids, even the biggest fights. And we were kids at the end of Tyson’s height and rise of Evander Holyfield. So these were big events. Even the next day sportscenter didn’t have highlights because of various rights deals with HBO to replay the fight.
I bring this all up because it seems as though in the 80s, boxing actually went to a version of the model you’re advocating. Big time boxing fights were clearly in extremely high demand so they charged the market clearing price for it. And to this day, the biggest fights generates huge money. But who here thinks boxing in America is particularly popular? If anything it’s lost a ton of audience to MMA. Boxing was one of the big three sports and now it’s barely a sliver of the sporting landscape.
I think to put in terms more commensurate with this post, charging a market clearing price today and maximizing revenue today is putting your future revenues at huge risk. Artists charging minimum $1,000 or charging pay-per-view to watch sporting events may bring in tons of revenue today but at the cost of excluding potential paying customers tomorrow. Kids famously don’t have money, but kids grow up and eventually get jobs and will have money.
To get to the specific example at hand, the “trendiness” of a restaurant is famously volatile. The hot place all the celebs want to go to can very easily be different a month from now. The sliver of a chance a “regular” person can get a table means you probably can still attract that person a months from now to get a reservation long after the celebs stopped coming. Put that reservation just 100% out of reach today and lots of middle and upper middle class people won’t even bother and forget about restaurant entirely. So much of leisure and entertainment and is about “buzz” and that “buzz” will only last so long the more you exclude regular people from having a sliver of a hope of being part of it.
Maximizing profits today is just very often not a smart long term strategy to maximize profits in the future.
I don't think pay per view is a good example of what Matt is suggesting here. He wants prices to rise for scarce goods. Watching boxing at home isn't scarce. Matts version would be boxing promoters charging more for ticket to live events while allowing people to watch at home cheaply. That would allow the sports to keep a wide audience
The point I’m trying to make is a little more general one; there are very good reasons to keep the price of entertainment (and I’ll include very trendy restaurants in this as this is a form of entertainment at a certain point) lower than the immediate market clearing price and one of them is that you want to make sure that your future customer base is as large as possible. Pursuing max profits now can actually be long term fool’s gold.
I should add. Given penetration of Amazon and streaming to American homes, NFL looking to expand its horizons to streaming makes sense.
10-15 years ago I think this would have been a terrible idea that would have resulted in a big onetime windfall but likely at the cost of falling viewership and likely a less popular league than exists today.
NFL is odious in so many ways. But its ability to essentially be the last unifying source of entertainment and only source of entertainment that hasn’t lost audience I think should be studied.
This is a great point, and well-said. The debate is about, to a large extent, a business strategy question, and most restaurant operators and entertainers disagree with Matt. (To be fair, a lot of restaurant operators and entertainers are sleepwalking through their business strategy - though following the herd is a legit, valuable choice a lot of the time.)
But there's another way to look at it: if I were the moralizing type, I might denounce that form of marketing as manipulative. Like every other lottery, it offers mostly false hope and discourages people from spending their time on higher-yield activities.
I'm not really going anywhere with this, but I appreciate you zooming out to a larger view with a longer time horizon.
The UFC has PPV events too, and it's been one of the fastest growing sports for years now. The problem with boxing is more related to the number of different titles and weight classes available, and an obsession with being undefeated. This leads to many lower-stakes fights and fewer blockbuster fights - it's pretty rare to have two fighters at the peak of their powers fight for a meaningful title anymore.
Boxing has always had different weight classes. One of the things Mike Tyson did was “unify” the belt. In other words there were actually multiple heavyweight champions in the 80s. And if anything boxing was way more corrupt back in the day.
Blaming pay-per-view as the be all end all of why boxing declined would be silly. Baseball has declined in popularity as well. Reality, with the extremely notable exception of NFL, everything is less popular today due to fracturing of media landscape.
But the fall of boxing from the discourse is especially pronounced and I really think the pay-per-view model is part of the story here.
UFC has one major sanctioning body that can kick out fighters if they don't agree to defending or challenging a title in their weight class. The issues with boxing are more to do with the number of sanctioning bodies and proliferation of different titles.
Correct. And the NFL clearly charged an arm and a leg for box seats and for Super Bowl tickets. I’d be the last person in the world to say the NFL is a pretty rapacious entity when it comes to making money.
But 60 years ago the owner of the New York Giants committed himself to revenue sharing for the good of the league. Even though it came at the cost of immediate short term profits that would have come from selling tv rights individually for giants games. And result is a huge part of why NFL is the biggest sports league in America and result is the Giants are probably worth way more now than they otherwise would have been.
Boxing's problem isn't putting its premium fights behind a PPV, it's that it's put nearly every fight of even modest interest behind a PPV. To make the restaurant analogy, they're charging $1,000 for a reservation at Rao's, which people will gladly pay, but also charging $500 for a reservation at Chili's, which dooms the general interest.
I think this post gives too short shrift to the idea of not wanting only rich people. Right now, it's some combination of rich people and people who really wanted the table or tickets and got lucky in the reservation system/planned ahead. And I think Taylor Swift and the owners of Carbone absolutely want the latter group.
You see this in places where there's a mad rush for scarce entries and no reselling as well -- national park entrance passes, in demand summer camps, etc. The thing to fix here is that online ticket systems are a bad approach to rationing, but the desire to allocate scarce goods via rationing is quite reasonable.
Carbone exists in a weird space, where it's not actually that great of a restaurant anymore, but has cultivated a sort of mystique through celebrities and influencers. As a result, the people who mainly go are tourists and clout chasers, in addition to the aforementioned famous people. So in that sense, I don't really care about Carbone selling tables — if you want good Italian food, there are much much better options in NYC.
As for your general point, I actually kind of agree. But I don't know what the alternative is to the current approach that doesn't involve this market clearing strategy.
For restaurants, a 5 dollar non-refundable charge to enter a lottery where you express preferences for what tables you want, and then you prepay for the meal as at Alinea. And reservations are transferrable. That gives people who can't pay the secondary market price a fair shot, reduces the incentive to reserve solely for resale, and ensure the restaurant gets the money it needs for the tables.
This is a reasonable and level-headed suggestion but I confess that I'm skeptical that it sufficiently reduces the incentive to reserve solely for resale -- seems like you'd have to make the $5 fee commensurate to the difference between primary and secondary market prices (or at least the opportunity cost of trying to make money out of that arbitrage instead of doing something else) to squeeze out the scalpers.
Ah, good point that I totally overlooked. Thanks for the correction. The relevant arbitrage difference isn't (secondary market price - primary market price) it's the expected value of [(secondary market price - primary market price) * probability of being a lottery winner].
I would probably need to chew on how this affects the primary vs. secondary market a bit more however given that it likewise reduces the expected consumer surplus of participants in the primary market in the same way.
EDIT: Your expected consumer surplus as a participant in the primary market is ([consumer surplus of the reservation] * [probability of getting reservation]) - $5.
so you participate in the primary market iff ([consumer surplus of the reservation] * [probability of getting the reservation]) > $5, or equivalently if [consumer surplus of the reservation] > $5 / P(lottery).
To make a profit in the secondary market, it must be the case that (([secondary market price] - [price of meal]) * probability of winning lottery) - $5 > 0
so [secondary market price] - [price of meal] > $5 / P(lottery) when the secondary market clears
but for the marginal buyer, [secondary market price] - [price of meal] === [consumer surplus]. (although note that for the non-marginal buyer consumer surplus may be more than this)
So my interpretation of this is that it looks to me like the secondary market under market-clearing conditions isn't disadvantaged relative to the primary market.
I think that a lottery is probably the best way of selling tickets to something that's scarce if you don't want to operate purely on price.
If you want to sell a ticket to Taylor Swift for $200, then the best way is to sell lottery tickets for $2 or something (enough to disincentivise resellers buying a thousand), have that open for a week so everyone that wants one can get one, then conduct the lottery and the winners have a week to buy an actual concert ticket - if they don't, then they get sold to the next few numbers that came up in the lottery. Do all of that, like six months before the concert. And have other tickets that are auctioned. So there are expensive tickets and cheap lottery tickets.
Restaurants are more complicated because the demand varies so much by time of day/week, and changing the prices is tricky. They generally do have a cheaper menu for lunchtimes, and there's often a "happy hour" or "pre-theater menu" to try to sell early evening reservations, and also various offer prices Tuesday to Thursday (many places close on a Monday to give staff a day off, instead of having a weekend). But there's a lot more ability to price discriminate than they actually use. The question is how much extra benefit they'd get.
You can literally go to Villa Mosconi two blocks over on MacDougal St if you want an authentic former (currently?) mobbed up Greenwich Village red sauce joint.
I feel like this post kind of has an overly simple view of the current restaurant eco-system. Like it's true that a lot of Carbone's (I'll use that as a stand in for a bunch of popular restaurants even though, as you say, it's kind of its own thing now) reservations come through specific drops of Resy that seem underpriced, but that's pretty surface level and there are two big things this ignores.
First, there has been a big recent resurgence in private clubs that do explicitly charge for access (Major Food Group, the Carbone people, literally just opened one in NYC with a private Carbone inside and there's SoHo House, Jean Georges is turning his largest restaurant into one, etc.). That's not selling individual reservations, but it's related.
And second, you can absolutely buy a reservation at Carbone without going through the secondary sales market. I know there's no button on their website that lets you drop ten grand for a Friday night table, but you can, among other things (1) book a room at an extremely fancy hotel and let the concierge get you in, (2) go to another Major Food Group restaurant a half dozen times, spend lavishly, and tip well and you will get a phone number that you can call to get a much easier reservation at Carbone, (3) book their private dining room for an enormous amount of money, (4) get an Amex black card and see if they can get you a table, etc. etc. These things have in common that they are a little closer to the "private club" feel than the "grubby money grab" feel, which comports with the idea that Carbone is in the hospitality and experience business, not just the selling you rigatoni for too much money business. Long term, most restaurants really really really want to cultivate high-spending regulars much more than they want to get any individual cover, so you have to think about how they do that when coming up with an optimal strategy.
I agree. I don't think matt is accurately portraying the downsides. He says that busy parents can get the reservation they want more easily but he means busy and rich parents. Busy parent who want to go to a restaurant enough to plan well in advance / jump through what ever hoops needed to be first in the queue loose out under his scheme.
It's my understand that some big artists will make sure the first few rows are saved for die-hard fans for this very reason -- better to look down and see people who are there for the love of the artist, rather than the rich guy purchasing the front row center seats for clout.
I would be more inclined to agree except reselling seems to really undercut this. It's one thing to charge say $100 / ticket (instead of the $1000 you can demand) so that almost every fan can potentially participate.
Right I think people in this position could do a much better job managing the rationing than they do, where it's rationed often by the vagaries of the web server.
I think the key point, where I agree with the post, is that in demand institutions need to recognize that there is much more demand than supply and decide explicitly how they want to allocate it. Swift tried this a little, but not very well. Restaurants are not doing this at all. Similarly, prestigious universities should recognize this too and adopt a rationing model more explicitly.
Agreed except that I think universities aren't really hiding the ball on rationing. Admissions officers routinely make pronouncements like "we could fill our entire student body with an essentially as-good cohort comprised entirely of people who were rejected for admission."
They say this and people tend to believe them since it’s a truism at this point - but it’s probably wrong. And the real question you have to ask anyway is rather the opposite - could they produce a better cohort. The answer almost certainly is yes, at least for elite institutions.
That doesn't work as well as one would hope -- if you can do that then either you don't have enough demand for this to matter, or you're risking significant money if the tables don't fill. And if you have tons of demand, that leads to big lines and annoyance for staff.
"if you can do that then either you don't have enough demand for this to matter, or you're risking significant money if the tables don't fill."
I think the premise of Matt's post is that these restaurants have enough demand for *every table* to get a reservation, well-before the night of. That's not the first case you outlined. I don't understand (or maybe just don't agree with) your point regarding the second case. If people are willing to repeatedly redial a phone to try to get a reservation, surely they're willing to stop by your restaurant to see if it has a spot before heading off to their backup restaurant.
Amusingly, this is also coming up in the context of the incredible Knicks-76ers series, where NY fans are showing up in droves in Philly since the tickets are much cheaper. The team is resorting to pleading with season ticket holders not to resell their tickets, and Josh Harris just bought 2000 tickets to give to local first responders and medical professionals as a sign of goodwill.
But it's been a related complaint for at least 30 years for sports teams... how do you price your tickets so that "regular" fans can attend and not just the very rich? And the answer is, you really can't due to precisely the reasons outlined here.
This happens all the time when teams play a team with more cultural capital than then. And is only now making headlines because Embiid cried about it. I'm sure I'm not alone in become very anti-Embiid this playoffs. And I'm a nuggets fan! I had reason to dislike him during the whole Jokic MVP race controversy.
I happened to be in town last January when the Sixers played the Nuggets, so I grabbed a ticket. Embiid wasn't scratched until just a few minutes before tipoff, making it something ridiculous like six straight times he hasn't played in Denver. The fans were *pissed*. We got a good "where's Embiid at? clap, clap, clap clap clap" chant going during the game.
It's a little more than that. Philadelphia has a HUGE inferiority complex with respect to other East Coast cities, New York in particular. They really pride themselves on their sports fandom and the "us against the world" mentality. So needless to say, it was jarring to hear the Wells Fargo Center taken over by Knicks fans in both Games 3 and 4 (and make no mistake, Knicks fans were in the majorty). There were even vendors selling Knicks gear on the concourse!
I'm with you on Embiid... he's the prototypical "empty stat" guy. An MVP should be able to lead his team to a conference finals at least, something he's never done once!
Hmm, you shouldn't have revealed yourself to be anti-Embiid. Now I'll be tempted to refrain from liking the articles you write and mess with your stats a hair 🤔
I used to actually really like Embiid. Thought he was hilarious, and an absolutely dominant talent. But like, come on. Even my friends who are sixers fans are pretty disappointed with his effort/dirty tactics.
This is related to the San Angeles Chargers phenomenon, where they simply don't have a fanbase anymore because Dean Spanos completely alienated them with the leadup and execution of moving the team. And yet, their tickets can still sell well sometimes...thanks to fans of the visiting team. It's nice to see an extra de facto home game every season.
The A’s owner got in trouble yet again when he touted fans coming to see “Athletics players or greats from other teams like Aaron Judge” or words to that effect.
They are so going to get the same thing the Raiders get in Vegas with visiting team fans flying in to route in some gambling and other entertainment with going to see their favorite team play. And they all deserve it.
Yeah. The Chargers situation should be legitimately revolting to sports fans (maybe only topped by what's happening with the Oakland A's). Sports are supposed to be entertainment and a source of civic pride. If the community trust is broken, what the hell is the point?
One thing the pandemic crystallized is that as much as the television sports viewing experience has improved, it's not fun to watch a game without any atmosphere. You'd think that would help persuade owners to be a bit more cognizant of fan concerns, but for the most part they aren't.
Some bits of English football (soccer) are starting to see the fans as being part of the entertainment that they put on for the TV viewers and are putting aside cheaper tickets for groups that they think are likely to do a lot of singing and chanting. This is sometimes local fans (ie they have to have addresses close to the ground) or long-term committed fans, or members of certain fan clubs where you have to be vouched for by other members of the club to be able to join.
At least with the Chargers there still is an atmosphere, just one that the visiting team fans are creating. That's great, because it's exactly what Spanos deserves.
The Sixers also re-sell their tickets directly on Ticketmaster to capture the after market profits which is off-putting in the local market. But I think the easier explanation is playoff scarcity. This is the Knicks first title-chasing team in at least 10 years. So thirsty Knicks fans are willing to pay top dollar in NYC or travel the short distance to Philly to get much cheaper tickets. A couple of years ago after a decade of truly miserable Phillies teams, in 2022 Phils fans were able to fly to Houson, get a hotel, and World Series ticket for less than going to a home game.
Also any slander against Joel Embiid's name is outragous. The man has one leg, is half-paralyzed, and still put up a triple double.
Fair point on the playoff scarcity, but it flies in the face of what Philly sports fans tell themselves and the world. If you want to make the claim that you're more passionate than other cities, better show up.
What Embiid is doing this week is impressive, no doubt. He and Maxey have essentially kept them in each game by themselves. But what about literally every other season? He gets worked by Al Horford in every Celtics playoff matchup. Couldn't beat Kawhi and Toronto. Couldn't beat Butler and the Heat. They couldn't even beat the Hawks! At some point, you've got to deliver.
Sixers are a distant third in Philly fandom support and this is their 7th year in a row in the playoffs, and with yet another impending playoff exit. The frustration is aimed at the organizational level and general disgust with former coach Doc Rivers. Embiid is the best player in the NBA when healthy (enormous caveat,) and Maxey is becoming transcendant. Everyone else is replaceable. Philly has a rich basketball history but it has been a frustrating time to suffer under the years of tanking and the unmet expecations of The Process. If passion is defined by after market ticket pricing/scarcity, then Eagles fans have a solid argument as the top NFL fanbase, and Philles fans absolulely are the best crowd come playoffs.
Embiid is nowhere close to the best player in the NBA even when healthy. Jokic, Doncic and Giannis are all a cut above, and you could argue that Brunson, Tatum, SGA, and even Anthony Edwards have surpassed him this year.
You're spot on with the Philly sports hierarchy. I might argue that the Steelers have a larger and more passionate NFL fanbase but that's nitpicking; the Eagles are in the conversation. It's interesting though, 30 years ago you might argue it would be Washington, but terrible ownership, a lousy team, and dumb stadium decisions have wrecked them. Nobody should take this stuff for granted. Hell, even the Giants and Jets are showing warning signs for similar reasons (albeit not nearly as bad on the ownership front). The Eagles fans have it pretty good!
"Embiid is nowhere close to the best player in the NBA even when healthy. Jokic, Doncic and Giannis are all a cut above, and you could argue that Brunson, Tatum, SGA, and even Anthony Edwards have surpassed him this year."
Jokis is clearly the best player in the league. I could see the argument for Doncic and Giannis being in the same tier as Embiid, but I think comparing a healthy Embiid to Brunson, Tatum, SGA, and Ant is completely wrong. They are amazing players in their own right, but none of them has even close to the impact that Embiid has when healthy. He's better than all of them except SGA on offense, and more impactful than all of them on defense.
His biggest drawback is that he's so big and the way he play's its hard for him to stay healthy, but when healthy its clear why its been Embiid and Jokic competing for MVP over the last couple of years.
I'll grant you the defense, but there's no way he's more impactful than any of those guys on offense. Other than Doncic (who's a universe to himself), all of those guys make their teammates much much better! Embiid can put up a 40/15 and nobody would blink an eye, but it's all empty calories unless he carries them to some playoff wins (again, this year aside, where he truly has no help other than Maxey).
I'll put it another way -- would any of those other teams trade their superstar for Embiid straight up, contract aside? Not a chance. Would the Sixers trade him for any of those guys? Morey would do it in a heartbeat.
I think that's generally true especially since basketball arenas have pretty limited seating but there are times when teams (especially in baseball with bigger stadiums and more games) are not really willing to sell tickets at a lower price when demand is down and would rather them be empty, so you have to go to the secondary market to see if any ticketholders are panicking and are willing to bit the bullet and take a loss rather than get nothing.
Well, now I feel dumb. Are tickets for regular season tickets a lot cheaper in Philadelphia too? My husband is a big Sixers fan, but we live closer to NYC, so I got him and my daughter tickets for a Sixers-Knicks game for Christmas. Weekend Knicks tickets were cheaper than weekend Nets tickets when I bought them.
Well if you're in NJ (I assume), you can take NJ Transit right to Penn Station and come out right at MSG, whereas you'd have to drive to Philly and park. The price difference probably isn't that significant for regular season games either.
You could, but the transfers aren't timed well and it would take you a long time (and Amtrak is expensive enough to make gas/parking/tolls worth it for the convenience).
If you are one of the lucky ones to get Taylor Swift tickets for $50 when the market-clearing price is $1000, you *are* paying a thousand dollars for those tickets. By not reselling the tickets, you are exchanging $1000 (technically $950) of your now higher net worth - for the opportunity to see the concert just like those that paid the market price.
One of my daughter's friend's mom scored tickets for herself, my daughter's friend, and friend's older sister. The friend sold his ticket another friend for $500, paid his mom back the $50 and pocketed the rest.
>I mean this all 100 percent seriously: Restaurants should charge for reservations<
And I agree with you 100% seriously. They should!
Also, Robert Reich (I'm mainly exposed to his thoughts these days via his Guardian pieces) strikes me as a guy who really values high fives from lefties a lot more than he cares about being accurate. I totally get a "He can't possibly sincerely believe what he just wrote" vibe from him.
Robert Reich's son Sam Reich runs a lovely little streaming service called Dropout (which rose from the ashes of College Humor, for those familiar). It's the best $6 a month I pay. Free advertisement over.
I vaguely recall him as a sensible neoliberal shill (like me) two odd decades ago. I mean, he did work for Bill Clinton! But maybe I'm misremembering...
OK, I'll acknowledge that "30 years" is wrong -- I doublechecked and he did defend free trade early in the first Clinton administration, but he published "Locked in the Cabinet" in April 1997, so there's not a very large window there.
I used to see him at the Starbucks on Wisconsin Avenue near Porter Street in those days. He was always approachable and would grin conspiratorially when teased about the contrast between his expressed views and administration policies. Bottom line: he hasn’t changed much except now he doesn’t need to be conspiratorial.
I loved this line: “a guy who really values high fives from lefties a lot more than he cares about being accurate.”
This made me laugh. I am picturing a kid looking at economist trading cards (my husband got a pack of them when he worked for an economics consulting firm) while his classmates are trading their Pokemon and Bakugan cards.
Exchanging a high five with a leftie is filled with peril as most of us are trained to do the dominant "right hand/right hand" high five. Good chance of just missing that left hand entirely.
Reich is a NIMBY in Berkeley who fights affordable housing being built nearby because it might affect is view and make it harder for him to drive his car to the weed dispensary.
Unlike some of Matt's other examples, great Carbonara is not in short supply. A table at Roscioli may be in short supply, but that is simply an issue of perception, not great Carbonara. As someone who works with the industry in NYC, there is an oversupply of great restaurants with great chefs cooking great dishes that anyone could get a table at on any night, without having to pay for a reservation. These restaurants are closing down all the time, because too many people are following the herd to Roscioli rather than exploring on their own. In fact, in the industry, if you wanted to debate where the best Carbonara is, for some, Roscioli may not even make the list. This isn't too say they shouldn't be able to charge wealthy people to buy out Roscioli's tables on demand, just as wealthy people can overpay for a bottle of Pappy Van Winkle whiskey. This is only to say that again, anyone wanting good Carbonara would be foolish to pay extra for that experience at Roscioli (or should just go for lunch!), whereas someone wanting to experience Taylor Swift should pay as much as possible for that experience, as nobody else is capable of providing it.
Also, as Matt only briefly touched on, the short supply of tables is mostly a matter of the top restaurants creating that short supply intentionally (holding tables in reserve for VIPs, celebrities, businesses, credit card promotions, or simply to create the image of being the kind of restaurant that is popular enough to have limited supply). In this, the system that Matt describes already exists, only behind-the-scenes. If you want a table at Roscioli on a Friday night, there are people to call and money to spend. Hedge funds can find a table anywhere they want, because restaurants know they will buy the $5000 bottles of wine. They don't need to pay for the reservation on top of that. Roscioli does not need a secondary system to make extra money for reservations there - they already have a system for that. Matt is arguing that the rest of us rubes should get access to that system, but that system also already exists - As he mentions, there are sites that offer restaurants the ability to sell seats at their tables (i.e peakreservations.com) and trade reservations, should Roscioli want to do that. But their system is working fine for them - just not as much for us.
The overall point being Roscioli and other high-profile restaurants do not need this system, or extra profit. The better option for restaurants (and customers) is to widen their knowledge of restaurants beyond Google and support the industry in general.
Amen. I don't live in a city with high-demand restaurants frequented by hedge fund managers, but we have the same phenomenon of people sticking to a handful of popular restaurants when there are so many equal or better restaurants that you can often just walk into and get a table. This is only amplified in a place like NYC.
I am in NYC every month or two - so I know the city fairly well, but not well enough to be aware of hidden gems. Do you have a recommendation for a resource to find good but undervalued restaurants? Lately, I have been taking the train to Sheepshead Bay and trying whatever cuisine I can't easily get at home, but it would be good to be a little less random.
The Infatuation stays on top of new restaurants here with a wide and honest filter ... People in the industry generally rely on it: www.theinfatuation.com/new-york
I am so uncool and out of touch and uncultured flyover swine that the idea of booking a reservation and then trading or selling it never occurred to me. I don't know when I last made a reservation at a restaurant, if I ever have.
I liked Matt's article today, but reading it gave me hives.
It's obviously a very rare local experience for most people, but Matt was able to springboard this off to more familiar experiences like live entertainment. And of course, this was a subtext to make the argument as to why rent control is bad, similar to his water pricing article which was a subtext to again advocate for a Pigouvian tax on GHG emissions.
Back in the dark ages, when people would sometimes call restaurants on the phone, it was well known at the fancy law firm where I worked that if you wanted a reservation at a hot restaurant you would have much, much more success calling from our desk phones than from your cell or home number. I used to get same-day reservations at Danny Meyer restaurants etc. on Friday nights through the magic of caller ID.
Totally off-topic, but I followed the Serious Eats advice (and then made some tweaks to match my preference) a few years ago, and now prefer my own carbonara better than any I've had at a restaurant - and I've worked and dined (and eaten carbonara) at some pretty darned high-end restaurants. (Maybe whatever NY restaurant I've never heard of has some special secret, but I doubt it.)
Anyway, my point is that I have no problem with paying a significant sum for Special Meals at reataurants, but I have even more fun to learning to cook the "easier" dishes myself, and saving my dining out $$$ for things which (for technique or equipment reasons) are beyond my ability to create for myself.
Also, carbonara isn't all that difficult. Give it a try!
For "perishable" goods like concert tickets, reservations, etc., I'm a huge fan of Dutch (reverse) auctions as a way to establish market clearing prices, but those are sadly almost never used for reasons discussed in the article. I remain convinced, however, that the person who develops a user-friendly on-line Dutch auction system for concert tickets will make billions.
BGGCon ( a board game convention I attend annually ) used this when they first sold premium badges. They started at $1000 /badge I think and said they would lower them $50 / day until they sold out (or hit a floor price of $300)
I've thought that a software system that allows bidding on pay for shift work would be useful for businesses that have a lot of fungible employees and that stay open on undesirable times.
Like at the beginning of each quarter shift bidding starts, proceeding by round. In the first round every shift pays some low amount. After 24 hours round 2 starts, with every remaining shift paying an additional 15% or so. Keep starting new rounds with higher prices until every shift is filled.
I could see this being useful for airline crew and hospital employees.
I like that, although the problem I immediately see (besides labor union opposition) is that the kind of jobs that involve shift work also typically are jobs where people would expect to earn a predictable income each month (as compared to gig workers, salesmen on commission, etc.). Also, unless you're dealing with a really big pool of workers, it seems like it's open to be gamed by the workers just all agreeing to withhold their bids for the first three rounds or something to drive the price higher.
Oh, definitely. This requires probably minimum fifteen or so fungible workers and anonymous bidding so that defection from collusion is easy.
I would be interested in the income predictability. My guess is that the biggest source of drama will just be that a system like this feels unfair to people who aren't very time-flexible, like parents.
I don't know whether it's been empirically tested, but I have a suspicion that in many cases if restaurants started charging market-clearing prices for bookings, the market-clearing price would be rather lower than the huge unmet demand for tables implies.
A little like the most expensive Ferraris and the Birkin bag, the fact that it's difficult to buy is a not insubstantial part of the appeal.
Where the analogy breaks down is how the owners cash in on the brand their sold-out restaurant creates. In the case of Hermes and Ferrari, you have to be a "good customer" and buy some of the less desirable (but still supremely expensive) gear to get the Birkin or the Daytona SP3. That doesn't directly translate to the restaurant scene.
In some cases, celebrity restaurateurs will open additional, more accessible venues; in some cases they sell cookbooks or make TV series, or get paid handsomely to replicate their New York restaurant in, say, Dubai.
I am frequently surprised how seldom actual lotteries are used. One event I participated in (National Homebrew Competition circa 2018) had limited capacity for entries, and money wasn't at all the point, so they had a two-week window to register for the lottery, and then did a random drawing to allocate entries to prospective participants.
Random allocation seems substantially better than "who can be online at the right moment and click the fastest".
Occam's razor suggests that the reason why, for instance, The New York Knicks don't do a lottery for tickets to the games is that everyone involved in the operation of the league and the venue is perfectly happy with the current system of 70% of the tickets being purchased for the purpose of being resold. And to some extent, the fans are fine with it too: Season ticket holders like reselling their tickets for profit, and fans like the flexibility of being able to buy tickets to whatever game they want as long as they're willing to fork over the cash.
True! Though if you allocate the tickets via lottery but allow resale in the same way as it happens now, is there really a functional difference between that and the current system where you open like 22 browser windows when tickets go on sale and hope you get lucky?
Absolutely! With the pure lottery, everyone who wants only spends a few seconds of time. With the current system, millions of people waste half an hour setting up their browser and camping out and rescheduling things they might have done precisely at the relevant time. The pure lottery is much more efficient at not wasting people’s lives.
Fair enough! I'd be fine with it. My preferred system, at least for a sports standpoint, would be to do the lottery for a certain portion of tickets but to ban those from being resold, and have the lottery be for people who pay a nominal fee to be 'club members' - a chance to get tickets into the hands of people who are fans of the team, but still allowing some of the tickets to be resold if that's what people want. But I don't think there's a 'right' answer, and I can obviously see a lot of people being outraged at the idea of paying $20 a year or whatever to be an Official Knicks Fan for the purpose of being able to enter into a ticket lottery with no guarantee of ever getting them.
I'm a Manchester United fan, and I live within walking distance of the ground. Costs me £40 a year to be a member so that I'm allowed to enter the ticket lottery.
Of course, English soccer, because of violence between fans, has had to have incredibly strict rules about purchasing tickets: you have to list the names of all the people you are buying for, they all have to have memberships, and if their ID doesn't match the name on their membership / their ticket, they will not be allowed into the ground.
Even in corporate hospitality, being a fan of the away team is going to get you in trouble: if you start chanting or you're wearing an away team shirt, even if you're in a private box, you'll get ejected at least, and probably arrested.
I think a lottery would also be fairest criteria for college admissions. Each university states clear, objective admissions criteria (e.g. test scores at least X, GPA at least Y), removes all the subjective stuff (e.g. essays) from the applications, and everybody who meets the qualifying criteria gets entered in a giant lottery, with admissions offers given to the winners. As offers are turned out, more names are drawn, until the entire freshman class is filled.
Of course, there are very clear and obvious reasons why no university will ever actually do this. It would destroy the mystique of choosing the best of the best. But, I think it would definitely be fairer than the current system.
Something like that would definitely be good for most grant applications. You couldn’t remove the subjective aspects, but you could stop the committee from spending hours arguing about the fine differences among marginal cases, and ensure that only the clear differences matter.
In 2005, my local MLB team used a lottery to determine which non-season-ticket-holder fans would have the right to purchase world series tickets for the face-value price of $125/ticket. (I won the lottery to purchase game 5 tickets, but the game was never played because the team got swept in 4 games; even though the base price of the tickets was refunded, I still lost about $20 in Ticketmaster fees, which was not; the way Ticketmaster gouges its customers is truly outrageous).
Is the "greed is good" speech so bad? I don't think greed is always good, but in the context in which Gekko is talking- investors taking over a poorly run company/shareholder activism- well, greed can clarify, can't it?
You wouldn't want to run your whole society on Gordon Gekko's ethical principles. But greedy investors have a role to play. That doesn't have anything to do with restaurant reservations or Taylor Swift tickets, of course.
I know well that markets work, yet I don’t like it when expanding them threatens to put goodies I enjoy out of reach. It takes a lot of self discipline/humility to admit “rich people can outbid me for things I would appreciate much more.”
For an individual good yes. But if I have 10 chances at spending money on shows a year, if they're too expensive I will go to 0 (the value of the show is < the value of the money). If they're less expensive I might _want_ to go to all 10, but due to competition/bad luck I only get to go to 1 ... but I only _spent_ the money on 1 so I'm better off. (assuming queueing for tickets itself isn't massively onerous - just entering a lottery)
This is sort of like my argument that low income workers (and people who want to transfer income to them) can rationally support minimum wages (although not why in comparison to a higher EITC) even knowing that the amount of labor demanded will decrease. Each worker has a rational expected value of an increase.
My bet is more mountains would just close. Skiing is just a bad business, with high-fixed costs and highly weather dependent revenue. The nation-wide pass is way of hedging against bad-weather in one specific region.
I remember trying to explain to my Swiftie cousin at Thanksgiving that you can't really complain that Taylor Swift concert tickets were simultaneously too expensive and also too hard to come by.
It didn't go well.
I support you, though
If you thought libertarian cousin was annoying, just *wait* until you meet neoliberal cousin!
Oh but, excuse me, have you met my heterodox cousin? He assures me that he is *fascinating AND clever*!
Specifically, one with intense economist brain. Economist brain is notorious for annoying people with.
I find libertarian cousin far more odious than neoliberal cousin. I'm very fond of the latter.
But you're also a Slow Borer.
Libertarian cousins have the occasional distinct lack of deodorant.
Normies seem to be incapable of thinking about real (rather than nominal) effects. I was briefly in the US during the Eras tour but even from overseas you could tell that many millions of hours were spent hunting down tickets. It's just not a productive way for society to operate. Similarly 'affordable' housing schemes that lead to small industries whose entire function is getting access to the under-priced real estate.
I think the issue is just scale.
Our moral intuitions are about a world where we know everyone, more or less, and passing out goods like the Big Man of a tribe is a plausible way to do things. You can see this on display in Cohen’s “Why Not Socialism?” You’d never charge a friend during a camping trip. But the fact that they’re my friend is doing a lot of the moral work: I know them and have a certain level of trust.
In the broader economy, I don’t know you, trust is mediated by institutions and norms which shape expectations on both ends of the relationship. (You can’t even trust the trustworthy, after all, because trust is about mutual expectations!)
If Taylor Swift could psychically assign tickets based on things like dedication, need, and so forth she could underprice them without problems. As it stands, we have to proxy for that using willingness to pay. And that, itself, goes off the rails because the marginal value of dollars declines rapidly after a point.
Which really just indicates a moral argument for redistribution: it makes our actual universe more like the imagined moral universe.
This is probably my favorite comment of the day, cheers.
If we could just stop being greedy, we would just share and be happy!
"Once we smash capitalism, people will of course just realize that someone else could make better use of their Manhattan apartment and gladly move to McCook, Nebraska to pick beets on a collective farm."
There’s a difference between Taylor Swift tickets, which no one needs, and housing, which everyone needs. Do you also think scarce medical resources should be allocated based on price rather than need? I’m 100% with Matt on restaurant reservations and concert tickets, but I also like to be able to walk down the street without tripping over homeless people. Of course affordable housing requires a certain abundance, just setting aside a few scarce units for “workforce” or low income families doesn’t help.
I suppose in general 'affordable' housing schemes don't seem to achieve anything or indeed be actively destructive (because they lower housing supply), and so the resources would be better spent increasing housing supply. There may be exceptions for people with special circumstances such as addiction.
Medical care is more challenging because patients lack the information to make their own consumption decisions. But typically what happens is an expertise-based allocation system. It's not whoever logs into the hospital's website first gets the care.
There are multiple different housing problems going on in many cities, there are (a) lower middle class working folks who can't afford housing that can be rented or purchased at a reasonable percentage of the median income in their area; (b) there are people who are low-income because of an inability to work-full time usually do to disability, the need to only work part-time or not at all due to caregiving for children or elderly family members or who lack sufficient skills to get regular employment. This group also includes a lot of people with low level behavior health issues involving addiction or mental health; and (c) There are people with severe behavioral health and mental health issues who require full wrap around services including with stable housing and or need to be housed in less traditional transitional housing until they are more stable. This group would include most of the chronically homeless populations in many areas.
All of these groups are helped to some degree by simply greatly expanding housing supply so that sorting allows for housing costs overall to be reduced. In many cases that alone would address group A but group b and c are probably always going to require some level of housing subsidization and group c is going to require intense subsidization. Group C is probably always going to be better served by housing built and run by governments and non-profits. But Group B could be helped by their being incentives to building subsidized units in new buildings. I think the issue is whether this is achieved through incentives like reduced design review or priority permitting or whether they are imposed as additional burdens on market based projects. In my own community it is the later in part because of state constitutional limit on taxing that create the need to "fund" mandates through these restrictions that could be better funded in different ways.
"Do you also think scarce medical resources should be allocated based on price rather than need?"
The entire point of government-provided health insurance ("Medicare for all") is that it simultaneously allows hospitals to allocate scarce medical resources based on price, without denying needed services to people.
If you want most people to live in publicly-funded housing, then that's a perfectly fine opinion to have (I hear Singapore operates so). But public housing isn't a magic wand: you've just shifted the problem from "restrictions on housing supply mean people don't have enough money to pay rents" to "restrictions on housing supply mean that local authorities don't have enough money to buy properties to rent out".
"The entire point of government-provided health insurance ("Medicare for all") is that it simultaneously allows hospitals to allocate scarce medical resources based on price, without denying needed services to people."
Government provided health insurance absolutely determines when it's no longer cost effective to provide potentially needed services to patients. In fact explicit rationing is a hallmark of many of these systems, internationally.
I'm using "needed" here to mean "high-impact", not merely "desirable".
One example of allocating scarce medical resources by price is that we could have auctioned off when you got your COVID vaccine dose, rather than having eligibility classes that determined place in line. Someone who is very at-risk but doesn't mind isolating for another month would probably be willing to pay less than someone who is less at-risk but desperately wants to return to social life, for example.
And there's no rule that bids in this auction would have to be out-of-pocket; insurance companies that expect to have to pay more to treat patients who are more at-risk would want to bid higher on them getting the vaccine sooner.
[This also would have led to less waste--the system acted as tho it was better to throw doses in the trash than let anyone jump the line, which is obviously not true from a public health perspective.]
Honestly, here in LA most folks we knew that wanted tickets has no trouble getting them (there were a lot of shows), and the markups were only mildly awful.
Here in Philadelphia I know people who attended an exuberant listening party held outside the stadium while the concert was underway. They described it as tons of fun and free with the exception of the mass transit fare.
Did Swifties believe that going to the concert was, what, 500 times more enjoyable than going to the Eras Concert movie? I suspect that with all costs considered, that's not an unrealistic ratio.
Having done both, yes, attending the concert was probably worth like 2000x more than seeing the movie. It really was a once in a lifetime experience - which is a term that gets tossed around way too often, but this kinda was that. And frankly, the frenzy/scramble to get the tickets was sort of part of that experience, part of the hype/anticipation.
In addition it to it being a special communal experience, two things that also made it very much worth what I paid (in full disclosure, I was one of the lucky ones who got face value tickets, I didn't pay resale prices) are that 1) she really is a fantastic performer who makes every single show feel like the most special show you've ever seen, and 2) unlike sports games I've bought expensive tickets to due to them being a once in a lifetime-type experience, it was basically a 100% guarantee it was going to be a great show, whereas sometimes a sports game (or a fancy restaurant meal you order) sucks. And even with concerts, there are bands I love whose live performances are just fine, whereas Taylor really is extraordinary at the live performance, plus the crowd/atmosphere takes it to the next level.
So I'd say yes, the Swift tickets were absolutely worth a ton more to see live than to see in movie theatres - but I don't think the current market-clearing price of an NHL playoff game in Boston (~$250+ for cheap seats, a rent or mortgage payment for good seats) is worth that much more than watching it on tv.
In my opinion, hockey in a well designed arena is the best in-person sport. Even the worst seat in the arena can be great. Football is interesting because up close you see tactics and further back (upper deck) you see strategy. Basketball, you see neither. And baseball, well, it's baseball.
I agree with this, which is why I a) usually buy upper deck seats for hockey and b) historically always would try to buy tickets to go to playoff games. The prices have gotten to be too much for me though. I go when I can buy tickets at cost via my season ticket holder share - I won't pay resale prices.
I'm not a Swift fan, but personally, going to see my favorite team win a championship in person would be 500 times more enjoyable to me than watching it on TV, if not more. I think there's a case to be made that in an era where every digital experience is available anywhere at any time for almost $0, scarce in-person events are only more valuable.
I would agree with this, though of course when you pay the price there's no guarantee you're actually going to see them win. Of course, if there was a guarantee, it wouldn't be as fun! The conundrum of sports fandom...
Related to Matt's point, when the Vancouver BC Winter Olympics released tickets both my husband and his best friend put into the lottery to get potential tickets to every game. The odds were so bad that they figured this way they would get to see at least one game. But there was a "hockey miracle" and they both got two tickets to almost every game including my husband's two tickets to the gold medal game. Because the lottery required you to give your credit card up front and agree to buys if you won this meant that our families now how had and combined "investment" is more than $30K in Olympic hockey tickets. The quoted language being very much part of the pitch they each made to their spouses to try to spin this into an "exciting opportunity" rather than an unapproved $15K expenditure of family funds. They actually did end up being able to sell all the extra tickets so that they could each go to each game for "free" since the resale price of the extra tickets covered the whole cost and they slept in the basement of my husband's best friends cousins. They felt it was totally worth it. But I imagine the folks who paid them well over face value to allow that would have preferred to just pay that directly.
Really Matt’s bravest article a slight critique of Taylor swift embedded in an article about restaurants. This guy will go where the data takes him!
I was worried about the comment section on this one! But all seems chill!
I was worried when I saw triple digit comments when I woke up, this didn't seem like that controversial of a subject to Slow Borers. Just a highly engaging one instead!
We're Slow Borers. Not Swift Borers.
(sorry!)
I am shocked you lived to tell the tale.
Why can't you complain about this? Yes More Taylor Swift Concerts in My Backyard
Marshawn Lynch already gave them immunity to that style of quake.
I genuinely don’t understand what happened here. Like it doesn’t feel plausible that Taylor was 10x as popular as she was on Rep and 1989 tours.
Like I would bite the bullet and pay but it feels lousy, and the demand side to concerts feels unrelated to the level of fame people have. Acts who aren’t even household names are commanding several hundred dollar nosebleeds.
I think it’s gotta be the unprecedented popularity across age cohorts.
Who’s the last star to command that attention? Michael Jackson?
It's also thoroughly amazing that she can do this given how abundant and diverse entertainment is these days in the absence of scarcity of mass media.
It's over determined, but I do think the broad age cohort has a lot to do with it. I recently saw Bruce Springsteen after paying Ticketmaster a ridiculous amount of money. An amount of money that would have been unthinkable to my 40 year younger self the last half dozen times I saw him. But back then the demand was strictly people my age. I didn't have to outbid upper middle age, upper middle class members of the PMC --- like me today. It was also true that no one sixty years old (me today) would have gone to anything like a rock concert. Add that to the general prosperity that Matt listed, and you really have a recipe for demand with very little meaningful price ceiling.
It'll be really interesting to see how many of these legacy acts will be able to sustain those kind of prices in the future, with music fandom being so much more dispersed these days.
I also think the fact that people don't "pay" for music the way that they used to and acts can't rely as much on that revenue is a big part of it. Concerts used to be viewed in large part as marketing for an album. Now it is like the album is the marketing for the concert.
Now we need an article about how expensive concert tickets and declining sales of new music are both the result of music creators failing to create fresh, sufficiently novel genres of music that kill off demand for prior genres and create generational divides in listenership!
Michael Jackson and Madonna were maybe as big, the Beatles were bigger, Elvis was maybe as big... and that's it in terms of the whole history of recorded music I think? She's in a really exclusive club.
I feel like there were a fair number in the 80s and 90, U2, Bruce Springsteen, Madonna, off the top of my head, but she and maybe Beyonce are sort of the last thing like monoculture in music. I suspect the cowboy Carter tour will command somewhat similar levels of attention.
Beyonce will assuredly sell out, but I don't think the Cowboy Carter tour is going to live in the cultural zeitgeist the same way the eras tour did. Mainly, because the eras tour hit so many different generations at once.
I don't think the three acts you mention had anywhere near the "17 year olds with their 40-something parents" vibe to the extent Swift does. Not even close. Not three or four decades ago, in any event. Sure, if those acts are touring *now* you'll get cross generational fan representation.
Exactly. The fact that I one-thousand-percent don't care about contemporary music and still know Taylor Swift is a big deal is just like my parents realizing in the early 80s that Michael Jackson was a big deal.
It does feel though that Beyonce was more popular than her pre-Covid.
Because Swift released two lockdown albums that massively expanded her fanbase by being stylistically different from her country and pop work, and the new fans they brought in were both older and more male than her previous fans.
America being unbelievably rich in historical terms + having access to endless digital content at home makes demand for special in-person experiences even greater (is my hypothesis at least)
Remember we USED to spend tons of money on recorded music. Now that's dirt cheap. Ergo, there's tons of money to spend on concerts (and even more to spend coming right out of the pandemic).
*Shakes fist at William Baumol*
Hey now, he was only the messenger!
Here's where I pump the idea of flying a thousand miles to go see an eclipse!
I think your hypothesis is extremely well-founded.
I think this was true in 2018 and Beyonce and Taylor were plenty famous back then and one ticket went for less than I paid to see Olivia Rodrigo, who I think is objectively far less well known than Tay and Bey in 2018. All of this was on Seat Geek so no Ticketmaster luck.
nominal wages and prices are a lot higher now than they were six years ago
About 25% higher on average. Taylor Swift tickets have gone up much much faster than that.
Thanks, Biden. No way I'm voting for you now.
I don't know if she's *10 times* as popular, but she's definitely a lot more popular post-pandemic thanks to Evermore and Folklore, AND her earliest generations of diehard fans are now fully into the workforce with considerable disposable income.
Some of them have kids that they're inculcating into the cult!
The second idea is something that I was kicking around too thinking about this as I drove to work. The ten times the price really is hard to get my head around. 1500 dollar nosebleeds isn't something I can imagine being sustainable for live entertainment.
Did people really like those albums so much more than previous ones?
Taylor is more popular than she was during rep/1989, her fanbase is older and has more disposable income than it did then, America is much richer with a much larger leisure class than it had during rep/1989, AND people with money put more value on these kinds of experiences than luxury goods compared to past generations of rich/upper middle class people... being able to Instagram being at a Swift concert or seeing Messi play or flying to go see the eclipse is the new status symbol in the way a fancy car or whatever might have been for others.
People love live music.
She is a lot more popular now. Even I, a middle aged woman, can't get away from people talking about her. Luckily, my kids aren't into her, or it would be non-stop.
Same for me, and I'm no longer middle aged.
This comment section is mostly men. Taylor Swift fans are mostly women. I get the impression some men don't realize how many women and girls love Taylor Swift, because they don't spend a lot of time talking to women and girls, and following women and girls on social media.
Ticket buyers are engaging in status competition in the global monoculture. It's a costly game.
I agree there's some status competition element of this, but I feel like you're pushing this view way too hard.
Do you have kids? I have teenage daughters and one of them went to the Eras tour (for free!). It's hard to capture or express what it meant to her, but I promise that status competition was only a small part of it.
You can buy a car that costs 10 times as much as a new Toyota Corolla. It will be a better car in a lot of real ways, and people absolutely exist who would pay that premium specifically just to enjoy the additional real features, not thinking at all about status.
I think it is still the case that the price of expensive cars is heavily influenced by car buyers who do care a lot about status.
I’m sure Eras is better than previous Swift tours, maybe for some ticket buyers, even enough to pay 10 times the prior price. But my guess is that 10 times higher ticket prices also have a lot to do with the social value of attending, for the marginal ticket buyer.
It's my impression that the "social value" of going to a Taylor Swift concert is mostly about the social experience, rather than status. Women and girls dress up, they trade friendship bracelets with others while they wait outside to go in, they bond with strangers in their sections at the concert. It's about a shared experience. This is also why "save up the money and go to a foreign country to watch Taylor Swift" is not a good substitute, for most attendees; it wouldn't be the same thing.
Absolutely, and sports fandom is not much different. For sure there are plenty of people who spend a ton of money on going to a big sporting event because it's a status symbol, they can Instagram it, it's cool to say I was there, etc.
But I'd say for most people, the opportunity to potentially be at an event with a rapturous crowd, with a shared experience that everyone there is going to remember and talk about for the rest of their lives, and thousands of people watching on tv wish they could have experienced live, + the bonds that get formed going to these games with family/friends etc is worth something that can't really purely be calculated economically - i.e., is my $500 Bruins playoff ticket 50 x more valuable and enjoyable to me than paying $10 to go to a minor league game.
"I think it is still the case that the price of expensive cars is heavily influenced by car buyers who do care a lot about status."
Conversely: how many people honestly do enjoy the features, and just use status as a proxy for quality to avoid having to check Consumer Reports when purchasing?
She cancelled Loverfest tour because of the pandemic, so there was pent-up demand.
So, you're saying that we may actually be at Peak Swift and it would be wrong to project that, by the year 2030, 25% of US GDP will be Taylor Swift concert tickets?
https://xkcd.com/2892/
Very good and the alt-text takes it to the whole next level!
No one should ever leave XKCD without checking the alt text.
I would not bet money on Taylor Swift concerts making up 25% of GDP.
I was being silly?
I know. I was being silly too. Guess it didn't come across that way.
I don't really get it either (and I think she's a pretty good artist) but her popularity really is insane right now
I've tried this: "If there's a limited supply the choices are a line, a raffle, an arbiter, or an auction."
It works like 10% of the time.
Thankfully, my Swiftie sister did not balk at the prices. Instead, she wanted me to give her tips on how to get them, since I've purchased plenty of music concert tickets in the past. I just bluntly told her: "Good luck, I got nothing for you.".
Same with Disney parks fans. They want cheap admission and short lines. Only way to have both is with a lottery system or tickets selling out immediately like concert tickets do. Most people get this, but there’s always a few who insist it’s just “corporate greed”.
Try telling them that they should become a fan of something less popular. Then the tickets are cheap and easy to get.
Matt hits on some interesting points, but I think he’s unaware of economists’ actual theory to explain why some restaurants/concerts/events/etc are persistently underpriced (sell out immediately).
These are what Gary Becker called “social goods”. Plays and restaurants are more fun to go to when they’re perceived as trendy. A big line at a restaurant, or an immediate sell out of tickets, is a signal of trendiness. So sellers of social goods deliberately underprice. If they try to increase prices, they risk falling out of fashion. E.g., if Hamilton increases prices so that markets for tickets will clear, it no longer sells out. Then maybe Wicked becomes the popular play instead, and no one wants to go to Hamilton, leading to empty seats.
(It’s been recognized for a long time that the arguments Matt points out for underpricing don’t make sense. However, upon further inspection, Matt’s take that it’s bad norms/irrationality doesn’t make too much sense either. For example, why didn’t Hamilton increase prices very gradually over time? That probably wouldn’t have been noticeable enough to upset people. This phenomenon also happens for watches/luxury cars /etc. for which it’s definitely feasible to increase prices over time. Overall, I’m really skeptical that Matt just solved a problem that would increase profits for sellers around the world!)
I accept the point that there are things that are more fun to go to when they’re perceived as trendy, but there's surely some median between killing the hype and selling out all the venue tickets in three minutes followed by resellers flipping them for ten times the face price.
Yeah, this is a good point. One of the subtleties of the “social goods” theory is that demand can be very fragile: a small price increase may cause the good to immediately fall out of fashion.
(Of course, I haven’t said anything about whether this is empirically plausible — it’s just a theory that I wish the article had discussed. I recently discussed a paper that tests the theory in the NFT market, and it seems to work there. But more evidence is needed.)
>A big line at a restaurant, or an immediate sell out of tickets, is a signal of trendiness.<
Supposedly back in the day, concert sellouts were cheap marketing for the real profit center, selling vinyl.
See, I can believe that, but at the same time the "sellout" process itself was a social event: giant lines around the venue with people camped out for days or weeks and such got a lot of free media attention and helped build fanbases in the pre-internet era. I'm very skeptical that the modern "sellout," which consists of sitting at one's kitchen table at home with a locked-up website and a phone with an automated voice saying there are delays due to high call volumes, generates the same sort of marketing benefit.
Oh, it definitely doesn't generate the same kind of marketing benefit, I'd imagine.
Both chik-fil-a and in-n-out love big lines so they can appear trendy.
I'm not so sure about chik-fil-a. At least at the closest one to me there's sometimes a big line but they also work pretty hard to get that line cleared - having 2 people standing outside taking orders instead of using the drive-through speaker box so they can pre-fetch everything.
Yeah, Chik-Fil-A is not shy about expanding service when they get regularly slammed. In-N-Out, on the other hand...
Ah yes, the velvet rope principle. You want to go to the club with the big line out front.
On one level, I agree with you, but this is not so different than surge pricing or price gouging (both of which generate significant backlash). My guess is that both factors are in play.
Speaking of Hamilton, I do think Broadway is actually overpriced right now. Demand is lower than a few years ago while supply of new shows has risen but ticket costs have gone up significantly. I read an article that part of that has to do with an increase in production cost and need to make up for the lower demand but that also seems like a recipe for show closings (which is what happened to a lot of shows in a very competitive environment for show openings this spring).
I don't think Restaurants even need to charge for tables per se - they should just take a deposit? I find it nuts that restaurants will usually book out tables when a reasonable proportion of people will just not show up, which is obviously wasteful and costly to the restaurant. Taking a deposit, which is taken off the bill at the end, is a fairly easy way to fix that problem - and in my experience already used at times of high demand (e.g. Valentines Day). Taking a deposit would presumably also dampen the trading of reservations?
There are restaurants that do this. Several reservations I've made recently (I think on Resy) asked for my credit card and warned of a 'no-show' charge. Can't remember now which restaurants, but it wasn't around a specific date--it was just a general policy.
You inevitably get into a lot of nasty fights and bad reviews with customers over this. "But I got sick! You want me to come in sick??" or "My grandma died and you want to charge me!"
And even if you want to make exceptions for these, the viral LPT that goes around - "want to get out a BS restaurant fee? Tell them you're sick!" means you have to try to actually discern who is telling the truth. When you get it wrong 1% of the time, that 1% turns into a viral boycott.
somewhat related: I really wish Yelp and other review sites would separate ratings for "service" and "food." Many restaurant ratings are driven by people angry at service issues (which most people don't care much about), so it's hard to determine who has good food (which most people do care about.)
Based on Amazon product reviews (many one-star reviews of products are about delivery issues), a lot of people would still manage to mess it up.
Yelp reviews are the worst! One thing that makes them crappy is that most places also have "unreliable" reviews that are hidden until you request them and that don't go into your overall rating. These reviews are often determined to be "unreliable" because the reviewer only or almost only gives good reviews.
People who advertise on Yelp can "elect" to have their "unreliable" reviews show and be included in their numerical rating system. So Yelp basically emphasizes the bad reviews for anyone who isn't paying their advertising fee as a way to blackmail folks into paying for the service. I regularly get emails from them pointing out that I would have a much higher score and have many more positive reviews shown if I advertised with them. As it is I have about 5 reviews that are 5 star and 1 review for 1 star from an utter nutjob pissed off that I had to reschedule a free consultation that I had offered her because of a parenting commitment who complained that prioritizing family over potential clients is okay for a mom who sells cupcakes but not an attorney. However, I have 12 5 star "unreliable reviews" that are currently effectively hidden that they could add into the mix. I have more work than I know what to do about right now (trying to figure out the pricing ethics of this with an in demand but necessary service) and frankly I think that 1 star review has probably gotten me more clients who are working moms and find it offensive than it has lost me. But the overall system in corrupt in my opinion.
Really, that could be dealt with simply by including a cut off time for cancellations, like when you reserve a hotel room and get charged for the night if you don’t cancel by a certain date or time. If you get sick or someone dies, you cancel.
Agreed. 2 places I can recall not refunding my money when I was sick and I don't ever want to go to those places again. If it were a non-refundable deposit (10-15% of the outing) I probably wouldn't have minded, but it was the entire price.
(EDIT: Neither of those places would easily have been able to find a replacement for me, presumably unlike a restaurant and walk-ins, so I kind of understand but not enough to want to use them again)
It's a real dilemma. I'm not sure what the right answer is even if someone is honestly sick, but it's impossible given that anyone can claim they're sick. Airlines have the same problem.
Charging the whole price, vs. a deposit does seem excessive. Then again, restaurants are a tough business. If someone has to lose $300 for a cancellation, I'm not sure it's fairer to ask the restaurant owner to eat it vs. one of their typically-well-off patrons.
Airlines deal with the problem by offering “flexible” tickets for a few hundred more than the non refundable ones.
I can confirm that the cocktail bar Death & Co. does this for their DC location.
Between no-show penalties, ID checks (to prevent reservation trading) and peak-time charges, restaurants have quite a few tools to manage this problem.
ID checks would seem the easiest. Aren't happy hours sort of reverse peak-time charges. My family eats crazy early and we always get happy hour specials.
You don't even need ID checks: just take a credit card when they book and only let them pay with that card.
I have been to a few places that implemented such a policy.
It got tricky when I had to void the card I paid with (because it got stolen) before going to the event. Now I can't verify because the credit card numbers aren't the same.
This was my thought - anyone smarter than me have thoughts on how this market function (hefty deposit that's taken off bill at end of night) vs the pure pay for reservation market? What distortions could occur in the deposit system that don't appear in the straightforward pay for reservations market?
They’re actually quite different!
Deposits exist to solve the problem of people not showing up. So a restaurant with flaky customers might use a deposit system. But if your customers always show up, the deposit is irrelevant.
A pay-for reservation system serves as a way to price discriminate against those who want to eat at busy times. If you want to go to the restaurant for lunch on Wednesday, you’ll pay a lower price than dinner on Saturday, since you need to pay for the Saturday night reservation. This is useful even if you know 100% of customers will show up for their reservations.
I think they're to create friction from trading the reservation as well. So you get a smaller secondary market for reservations. Like the secondary market can still happen but it's like PayPal to some random person you don't know rather than sell in an apps' created market. Could be wrong tho.
I see both improving the situation around reservations getting snapped up fast. Why wouldn't a sufficiently expensive deposit work the same as a market clearing reservation price?
It's true that as long as everyone will skip their reservation with positive probability, then setting a sufficiently high deposit will clear the market (since a $10k deposit, e.g., would be too much for most people to risk losing).
Nevertheless, the two schemes still differ in their allocative effects. When you use deposits to clear the market, you're selecting in favor of the least flaky customers. When you use a reservation fee, you're selecting in favor of those who value eating at busy times.
Deposit fees are more efficient when the main problem is too many reservation-happy customers who don't show up. Reservation fees are more efficient when the main problem is too many low-value customers showing up at busy times.
So is clearing price defined by how long it takes to sell the resevations?
They do, though that can be its own PR nightmare.
https://boston.eater.com/2024/2/26/24083939/table-north-end-restaurant-cancellation-fees-viral-customer-exchange
But. yes, if they made it explicit—you pay whether or not you show up—the resulting transparency would probably improve the situation.
Interesting and related aside...Where I live there is an outdoor amphitheater on a river. Across the river is a restaurant with outdoor seating. On concert nights in the summer the restaurant lets you book a table with a $400 dollar purchasing minimum on nights with popular concerts (you can hear from the restaurant). The money is like a deposit but goes toward purchases (so you have to spend $400 minimum).
I have not done this yet but plan to. A friend told me about it and had a great experience.
This is starting to be standard at high end places. I've never heard of a place selling a reservation outright and not just taking a deposit.
Beat me to it, this was my idea that was percolating in my mind ever since Matt tweeted the thesis of this article out 9 days ago. It elegantly solves the problem of vendors that want to give their customers a good, below market price, but have to clear the market or else rent seeking middlemen will do it for them.
This was not a good day for me to be a person experiencing Westernness and already seeing triple digit comments when I woke up. I should have done what my fellow Boisean Rory did and go to Argentina.
Wenty to a hip place for anniversary last week and they had a like $25/person no show fee on the reservation. They also confirmed with us like 3 times.
Most trendy restaurants do this in south Florida at least.
Downside of deposits for reservations is reservations are less movable, ig you could half or quarter the charge/deposit for cancelations +12 hrs in advance or something. Like if you always get charged seems more likely that someone just no shows rather than cancels with notice.
I was literally sitting here in Argentina refreshing waiting for an article so I could post early. And I get restaurant reservations. I’m not a foodie, and I live in Boise, where reservations aren’t a big deal.
But I do work in New York City occasionally; usually on short notice. So if I could pay extra to get a reservation at a good restaurant if I needed, I would appreciate it.
Capitalism is good, so are market forces.
Also, the Food in Argentina is overrated, but the tomatoes are delicious. Why can’t we have tomatoes that taste like they taste here.
On a Taylor Swift note, My wife paid $6000 for three Taylor Swift tickets in Los Angeles to take her daughters. The whole trip cost 10,000, since she had to fly them from Hawaii and Boise. She said it was worth every penny, for the concert and spending time with her daughters.
Honestly tomatoes ya just gotta grow yourself. So unbelievably good in late summer.
Just two things that money can't buy,
That's true love and homegrown tomatoes.
But you can spend a lot of money cultivating homegrown tomatoes!
You should see how much money I spent on soil for more raised beds this year.
I moved in 2021, went from bumper crops of three different heirloom varieties to dust bowl like outcome where I currently live. I'm in for more compost, more tilling, and anything else I can think of for this year. there is no substitute good.
Reduce your tilling, mulch heavily with compost, add a lot of worms.
Also bell peppers
Can't find it now, but there's been a lot written how American supermarkets select for uniformity and color over taste, leading to generally bland tomatoes even though much tastier varietals are available.
I have a friend who spent a month in Italy, and he said the same thing about the tomato’s there. Comparatively, tomatoes in the US taste like cardboard.
You just have to find the brands and farmers markets that offer more fragile varieties.
Beefsteak tomatoes are garbage.
This has been my experience, a late summer tomato at a farmers market hits incredibly hard.
Cherokee Purple is the best tomato.
I like green zebras for salads but blight hit local growers last year so none at the farmers market. Sigh.
Green zebras are pretty good too! As are Sungold cherry tomatoes.
When I moved to DC in the 90s from Boston/Michigan, I quickly became a winter softie. But I never (and to this day haven't) adjusted to the summers. My only consolations during the scorching season are tomatoes and peaches!
In the US, you can get decent local tomatoes in places with good climate and soil for them. Like New Jersey (seriously).
But the best tomatoes I’ve ever had were in Egypt. Deep red, sweet, and incredibly rich flavor and dense texture. Just unlike anything else. My brother, who refuses to eat raw tomatoes anywhere else, happily scarfs them down in Cairo.
Is this still true? Whole Foods has pretty good tomato selection year round, and funky-looking heritage breeds in the summer. Are there better tomatoes than that elsewhere?
Oh yes. Its impossible to describe how sweet juicy and delicious tomatoes can be overseas.
That is the advantage of the Kumato; they actually taste better.
The only truly great varietal is the Tommaco. I'm positively addicted to those.
This earns an immediate reflexive upvote as soon as I saw it.
They taste like Grandma.
Where I live now in CT tobacco is the top crop, maybe I can hybridize some Tommaco.
On the Tomatoes point, I kind of like you can only get some delicious things in certain places. I’ve never been to Argentina but, if I do go, I’ll be sure to try the Tomatoes.
When I was in the Philippines recently I had Mangos on Gimeras Island off the coast of Ilo Ilo city. They are insane, like another level of Mango that truly does not exist anywhere else. I’m sad I can’t get them here in the US but it does keep me looking forward to traveling back there one day.
My girlfriend will basically refuse to eat Mangoes (despite loving them) in the US for a while whenever she returns from visiting her family in India, because they simply don't compare. I haven't had one yet and I cannot wait.
Sad to say that the imported mangoes from central and South America are also not as good.
Mangoes and papayas are delicious if you are eating in a tropical country that grows them, but consistently repulsive when you buy in the US, no matter the country they’re grown in. The ones shipped here aren’t allowed to ripen enough before being picked.
Now I want mangoes.
Summer camps, after-school care, and kid activities are another big one where the prices are reasonable but scarcity high. In Boston area if you haven’t signed your kid up by January then enjoy the wait-lists.
I got on a wait-list for day care when my kid was born... He started this week... He was born Feb 2022.
The price is 40% of his (now former) nanny.
Even in places like Boise or South Carolina. You have to sign up early.
... January? Our summer camp opens registration November 1 and seems to fill up in a week or two.
I’ve been to Guinaras too! Great mangoes!
My friend has a small orange grove in her back yard in the Algarve (southern Portugal). The oranges from those trees, in season, taste spectacular.
Ataulfo/Champange/Honey mangoes are pretty good and show up in US supermarkets seasonally.
People I know from mango-growing countries will get into fights over what the *best* kind of mango is, but they're generally happy to agree that ataulfos are second-best.
(the Tommy Atkins ones that US markets usually carry do not make the list at all).
>Why can’t we have tomatoes that taste like they taste here.<
Rory: Long time no hear!
I remember reading once that US produce supply chains prioritize uniformity, coloration/appearance, and 12-month availability. And that as a result, taste sometimes suffers.
The thing is, I didn’t realize how much I was missing.
Also, thanks. I’ve been busy at work. I go through commenting phases.
This raises one of those interesting questions about the origin of consumer preferences.
Worth a hundred times more than taking them to the Eras Tour concert movie?
Well let's see, if my Sharks ever made the Stanley Cup Finals again, would I rather go to the seventh game, or watch the video later?
Yes, for Swifties, going to the concert absolutely would be worth 100 times more than watching the movie.
Santorini for tomatoes. Or my sister’s garden.
Barbacoa could have easily been the pioneer in charging for reservations, but they have wisely instead increased their supply with a new place in Eagle and somewhere else.
And I'm liking the tomato discourse here, I don't really dig fresh whole tomatoes that much, and now I might have a reason as to why.
I've eaten one time at Barbacoa... was severely disappointed. I have to try it again, but for $100 a plate... its a hard decision.
I just read about a Mexican place in Caldwell that is meant to be absolutely delicious. Nationally renown.
Yeah, Barbacoa is definitely a place where you're paying for the ambience as well. And the Caldwell place I think you're thinking of is Amano, I still need to go there some time.
I’ve never paid for or watched a boxing fight in my life.
My best friend and I are huge sports fans. When we get together, it’s most often at aa sports bar. Lately, it has been watching NBA playoffs, but it has also included NCAA tourney games, NFL and MLB games over the course of our friendship. But never once have we decided to watch a boxing fight nor has it ever crossed our minds to pay for a fight; even the biggest ones. And we’re definitely the type of fans to watch Kentucky Derby, watch last hour of the Masters or US open final. In other words, even sports were not huge fans of, if the event is big enough, we may watch.
We’ve both agreed that the biggest reason we’ve never watched boxing is the Pay-Per-View model introduced in the 80s. Combined with the fact the biggest fights were in Vegas and started at midnight east coast time, it just was never in the cards for us to watch anything as kids, even the biggest fights. And we were kids at the end of Tyson’s height and rise of Evander Holyfield. So these were big events. Even the next day sportscenter didn’t have highlights because of various rights deals with HBO to replay the fight.
I bring this all up because it seems as though in the 80s, boxing actually went to a version of the model you’re advocating. Big time boxing fights were clearly in extremely high demand so they charged the market clearing price for it. And to this day, the biggest fights generates huge money. But who here thinks boxing in America is particularly popular? If anything it’s lost a ton of audience to MMA. Boxing was one of the big three sports and now it’s barely a sliver of the sporting landscape.
I think to put in terms more commensurate with this post, charging a market clearing price today and maximizing revenue today is putting your future revenues at huge risk. Artists charging minimum $1,000 or charging pay-per-view to watch sporting events may bring in tons of revenue today but at the cost of excluding potential paying customers tomorrow. Kids famously don’t have money, but kids grow up and eventually get jobs and will have money.
To get to the specific example at hand, the “trendiness” of a restaurant is famously volatile. The hot place all the celebs want to go to can very easily be different a month from now. The sliver of a chance a “regular” person can get a table means you probably can still attract that person a months from now to get a reservation long after the celebs stopped coming. Put that reservation just 100% out of reach today and lots of middle and upper middle class people won’t even bother and forget about restaurant entirely. So much of leisure and entertainment and is about “buzz” and that “buzz” will only last so long the more you exclude regular people from having a sliver of a hope of being part of it.
Maximizing profits today is just very often not a smart long term strategy to maximize profits in the future.
I don't think pay per view is a good example of what Matt is suggesting here. He wants prices to rise for scarce goods. Watching boxing at home isn't scarce. Matts version would be boxing promoters charging more for ticket to live events while allowing people to watch at home cheaply. That would allow the sports to keep a wide audience
The point I’m trying to make is a little more general one; there are very good reasons to keep the price of entertainment (and I’ll include very trendy restaurants in this as this is a form of entertainment at a certain point) lower than the immediate market clearing price and one of them is that you want to make sure that your future customer base is as large as possible. Pursuing max profits now can actually be long term fool’s gold.
I should add. Given penetration of Amazon and streaming to American homes, NFL looking to expand its horizons to streaming makes sense.
10-15 years ago I think this would have been a terrible idea that would have resulted in a big onetime windfall but likely at the cost of falling viewership and likely a less popular league than exists today.
NFL is odious in so many ways. But its ability to essentially be the last unifying source of entertainment and only source of entertainment that hasn’t lost audience I think should be studied.
This is a great point, and well-said. The debate is about, to a large extent, a business strategy question, and most restaurant operators and entertainers disagree with Matt. (To be fair, a lot of restaurant operators and entertainers are sleepwalking through their business strategy - though following the herd is a legit, valuable choice a lot of the time.)
But there's another way to look at it: if I were the moralizing type, I might denounce that form of marketing as manipulative. Like every other lottery, it offers mostly false hope and discourages people from spending their time on higher-yield activities.
I'm not really going anywhere with this, but I appreciate you zooming out to a larger view with a longer time horizon.
The UFC has PPV events too, and it's been one of the fastest growing sports for years now. The problem with boxing is more related to the number of different titles and weight classes available, and an obsession with being undefeated. This leads to many lower-stakes fights and fewer blockbuster fights - it's pretty rare to have two fighters at the peak of their powers fight for a meaningful title anymore.
Boxing has always had different weight classes. One of the things Mike Tyson did was “unify” the belt. In other words there were actually multiple heavyweight champions in the 80s. And if anything boxing was way more corrupt back in the day.
Blaming pay-per-view as the be all end all of why boxing declined would be silly. Baseball has declined in popularity as well. Reality, with the extremely notable exception of NFL, everything is less popular today due to fracturing of media landscape.
But the fall of boxing from the discourse is especially pronounced and I really think the pay-per-view model is part of the story here.
MMA (UFC) also puts its big fights on PPV.
UFC has one major sanctioning body that can kick out fighters if they don't agree to defending or challenging a title in their weight class. The issues with boxing are more to do with the number of sanctioning bodies and proliferation of different titles.
Correct. And the NFL clearly charged an arm and a leg for box seats and for Super Bowl tickets. I’d be the last person in the world to say the NFL is a pretty rapacious entity when it comes to making money.
But 60 years ago the owner of the New York Giants committed himself to revenue sharing for the good of the league. Even though it came at the cost of immediate short term profits that would have come from selling tv rights individually for giants games. And result is a huge part of why NFL is the biggest sports league in America and result is the Giants are probably worth way more now than they otherwise would have been.
Boxing's problem isn't putting its premium fights behind a PPV, it's that it's put nearly every fight of even modest interest behind a PPV. To make the restaurant analogy, they're charging $1,000 for a reservation at Rao's, which people will gladly pay, but also charging $500 for a reservation at Chili's, which dooms the general interest.
I think this post gives too short shrift to the idea of not wanting only rich people. Right now, it's some combination of rich people and people who really wanted the table or tickets and got lucky in the reservation system/planned ahead. And I think Taylor Swift and the owners of Carbone absolutely want the latter group.
You see this in places where there's a mad rush for scarce entries and no reselling as well -- national park entrance passes, in demand summer camps, etc. The thing to fix here is that online ticket systems are a bad approach to rationing, but the desire to allocate scarce goods via rationing is quite reasonable.
Carbone exists in a weird space, where it's not actually that great of a restaurant anymore, but has cultivated a sort of mystique through celebrities and influencers. As a result, the people who mainly go are tourists and clout chasers, in addition to the aforementioned famous people. So in that sense, I don't really care about Carbone selling tables — if you want good Italian food, there are much much better options in NYC.
As for your general point, I actually kind of agree. But I don't know what the alternative is to the current approach that doesn't involve this market clearing strategy.
For restaurants, a 5 dollar non-refundable charge to enter a lottery where you express preferences for what tables you want, and then you prepay for the meal as at Alinea. And reservations are transferrable. That gives people who can't pay the secondary market price a fair shot, reduces the incentive to reserve solely for resale, and ensure the restaurant gets the money it needs for the tables.
This is a reasonable and level-headed suggestion but I confess that I'm skeptical that it sufficiently reduces the incentive to reserve solely for resale -- seems like you'd have to make the $5 fee commensurate to the difference between primary and secondary market prices (or at least the opportunity cost of trying to make money out of that arbitrage instead of doing something else) to squeeze out the scalpers.
No, the trick is that with a lottery, $5 doesn't get you a resalable reservation, just a ticket for the lottery. So it's significantly less valuable.
Ah, good point that I totally overlooked. Thanks for the correction. The relevant arbitrage difference isn't (secondary market price - primary market price) it's the expected value of [(secondary market price - primary market price) * probability of being a lottery winner].
I would probably need to chew on how this affects the primary vs. secondary market a bit more however given that it likewise reduces the expected consumer surplus of participants in the primary market in the same way.
EDIT: Your expected consumer surplus as a participant in the primary market is ([consumer surplus of the reservation] * [probability of getting reservation]) - $5.
so you participate in the primary market iff ([consumer surplus of the reservation] * [probability of getting the reservation]) > $5, or equivalently if [consumer surplus of the reservation] > $5 / P(lottery).
To make a profit in the secondary market, it must be the case that (([secondary market price] - [price of meal]) * probability of winning lottery) - $5 > 0
so [secondary market price] - [price of meal] > $5 / P(lottery) when the secondary market clears
but for the marginal buyer, [secondary market price] - [price of meal] === [consumer surplus]. (although note that for the non-marginal buyer consumer surplus may be more than this)
So my interpretation of this is that it looks to me like the secondary market under market-clearing conditions isn't disadvantaged relative to the primary market.
I think that a lottery is probably the best way of selling tickets to something that's scarce if you don't want to operate purely on price.
If you want to sell a ticket to Taylor Swift for $200, then the best way is to sell lottery tickets for $2 or something (enough to disincentivise resellers buying a thousand), have that open for a week so everyone that wants one can get one, then conduct the lottery and the winners have a week to buy an actual concert ticket - if they don't, then they get sold to the next few numbers that came up in the lottery. Do all of that, like six months before the concert. And have other tickets that are auctioned. So there are expensive tickets and cheap lottery tickets.
Restaurants are more complicated because the demand varies so much by time of day/week, and changing the prices is tricky. They generally do have a cheaper menu for lunchtimes, and there's often a "happy hour" or "pre-theater menu" to try to sell early evening reservations, and also various offer prices Tuesday to Thursday (many places close on a Monday to give staff a day off, instead of having a weekend). But there's a lot more ability to price discriminate than they actually use. The question is how much extra benefit they'd get.
You can literally go to Villa Mosconi two blocks over on MacDougal St if you want an authentic former (currently?) mobbed up Greenwich Village red sauce joint.
You can also get the vodka rigatoni Carbone is based on, which really isn't all that special, at Parm for much less money.
I loved the original Parm on Mulberry when it first opened. Now I just go to the one in Battery Park City since it’s always empty.
I feel like this post kind of has an overly simple view of the current restaurant eco-system. Like it's true that a lot of Carbone's (I'll use that as a stand in for a bunch of popular restaurants even though, as you say, it's kind of its own thing now) reservations come through specific drops of Resy that seem underpriced, but that's pretty surface level and there are two big things this ignores.
First, there has been a big recent resurgence in private clubs that do explicitly charge for access (Major Food Group, the Carbone people, literally just opened one in NYC with a private Carbone inside and there's SoHo House, Jean Georges is turning his largest restaurant into one, etc.). That's not selling individual reservations, but it's related.
And second, you can absolutely buy a reservation at Carbone without going through the secondary sales market. I know there's no button on their website that lets you drop ten grand for a Friday night table, but you can, among other things (1) book a room at an extremely fancy hotel and let the concierge get you in, (2) go to another Major Food Group restaurant a half dozen times, spend lavishly, and tip well and you will get a phone number that you can call to get a much easier reservation at Carbone, (3) book their private dining room for an enormous amount of money, (4) get an Amex black card and see if they can get you a table, etc. etc. These things have in common that they are a little closer to the "private club" feel than the "grubby money grab" feel, which comports with the idea that Carbone is in the hospitality and experience business, not just the selling you rigatoni for too much money business. Long term, most restaurants really really really want to cultivate high-spending regulars much more than they want to get any individual cover, so you have to think about how they do that when coming up with an optimal strategy.
I agree. I don't think matt is accurately portraying the downsides. He says that busy parents can get the reservation they want more easily but he means busy and rich parents. Busy parent who want to go to a restaurant enough to plan well in advance / jump through what ever hoops needed to be first in the queue loose out under his scheme.
It's my understand that some big artists will make sure the first few rows are saved for die-hard fans for this very reason -- better to look down and see people who are there for the love of the artist, rather than the rich guy purchasing the front row center seats for clout.
I would be more inclined to agree except reselling seems to really undercut this. It's one thing to charge say $100 / ticket (instead of the $1000 you can demand) so that almost every fan can potentially participate.
Right I think people in this position could do a much better job managing the rationing than they do, where it's rationed often by the vagaries of the web server.
I think the key point, where I agree with the post, is that in demand institutions need to recognize that there is much more demand than supply and decide explicitly how they want to allocate it. Swift tried this a little, but not very well. Restaurants are not doing this at all. Similarly, prestigious universities should recognize this too and adopt a rationing model more explicitly.
Agreed except that I think universities aren't really hiding the ball on rationing. Admissions officers routinely make pronouncements like "we could fill our entire student body with an essentially as-good cohort comprised entirely of people who were rejected for admission."
They say this and people tend to believe them since it’s a truism at this point - but it’s probably wrong. And the real question you have to ask anyway is rather the opposite - could they produce a better cohort. The answer almost certainly is yes, at least for elite institutions.
Yes, but restaurants already have a functioning lottery system: just reserve half your tables for walk-ins.
That doesn't work as well as one would hope -- if you can do that then either you don't have enough demand for this to matter, or you're risking significant money if the tables don't fill. And if you have tons of demand, that leads to big lines and annoyance for staff.
"if you can do that then either you don't have enough demand for this to matter, or you're risking significant money if the tables don't fill."
I think the premise of Matt's post is that these restaurants have enough demand for *every table* to get a reservation, well-before the night of. That's not the first case you outlined. I don't understand (or maybe just don't agree with) your point regarding the second case. If people are willing to repeatedly redial a phone to try to get a reservation, surely they're willing to stop by your restaurant to see if it has a spot before heading off to their backup restaurant.
What I mean is that you get big lines as people wait for a first-come table, and lots of people who don't get one get mad.
Amusingly, this is also coming up in the context of the incredible Knicks-76ers series, where NY fans are showing up in droves in Philly since the tickets are much cheaper. The team is resorting to pleading with season ticket holders not to resell their tickets, and Josh Harris just bought 2000 tickets to give to local first responders and medical professionals as a sign of goodwill.
But it's been a related complaint for at least 30 years for sports teams... how do you price your tickets so that "regular" fans can attend and not just the very rich? And the answer is, you really can't due to precisely the reasons outlined here.
Edit: the Sixers have taken to handing out tickets to random fans on the streets! https://www.instagram.com/reel/C6ctLNjuMLx/?igsh=Z3dud3R2Y3o1NW0y
This happens all the time when teams play a team with more cultural capital than then. And is only now making headlines because Embiid cried about it. I'm sure I'm not alone in become very anti-Embiid this playoffs. And I'm a nuggets fan! I had reason to dislike him during the whole Jokic MVP race controversy.
I happened to be in town last January when the Sixers played the Nuggets, so I grabbed a ticket. Embiid wasn't scratched until just a few minutes before tipoff, making it something ridiculous like six straight times he hasn't played in Denver. The fans were *pissed*. We got a good "where's Embiid at? clap, clap, clap clap clap" chant going during the game.
It's a little more than that. Philadelphia has a HUGE inferiority complex with respect to other East Coast cities, New York in particular. They really pride themselves on their sports fandom and the "us against the world" mentality. So needless to say, it was jarring to hear the Wells Fargo Center taken over by Knicks fans in both Games 3 and 4 (and make no mistake, Knicks fans were in the majorty). There were even vendors selling Knicks gear on the concourse!
I'm with you on Embiid... he's the prototypical "empty stat" guy. An MVP should be able to lead his team to a conference finals at least, something he's never done once!
Hmm, you shouldn't have revealed yourself to be anti-Embiid. Now I'll be tempted to refrain from liking the articles you write and mess with your stats a hair 🤔
I used to actually really like Embiid. Thought he was hilarious, and an absolutely dominant talent. But like, come on. Even my friends who are sixers fans are pretty disappointed with his effort/dirty tactics.
He is literally playing injured right now lol. And he played 48 minutes in game 5!
No comment on the hypothetical dirty play though 😬
Embiid is the culmination of the process, a natural born loser - the sixers will never win the championship with him as their best player.
Maxey is the man though.
This is related to the San Angeles Chargers phenomenon, where they simply don't have a fanbase anymore because Dean Spanos completely alienated them with the leadup and execution of moving the team. And yet, their tickets can still sell well sometimes...thanks to fans of the visiting team. It's nice to see an extra de facto home game every season.
The A’s owner got in trouble yet again when he touted fans coming to see “Athletics players or greats from other teams like Aaron Judge” or words to that effect.
They are so going to get the same thing the Raiders get in Vegas with visiting team fans flying in to route in some gambling and other entertainment with going to see their favorite team play. And they all deserve it.
Hey, that's not fair. The A's will probably never even make it to Vegas. And if they do the visiting fans might not even bother going to the games.
Yeah. The Chargers situation should be legitimately revolting to sports fans (maybe only topped by what's happening with the Oakland A's). Sports are supposed to be entertainment and a source of civic pride. If the community trust is broken, what the hell is the point?
One thing the pandemic crystallized is that as much as the television sports viewing experience has improved, it's not fun to watch a game without any atmosphere. You'd think that would help persuade owners to be a bit more cognizant of fan concerns, but for the most part they aren't.
Some bits of English football (soccer) are starting to see the fans as being part of the entertainment that they put on for the TV viewers and are putting aside cheaper tickets for groups that they think are likely to do a lot of singing and chanting. This is sometimes local fans (ie they have to have addresses close to the ground) or long-term committed fans, or members of certain fan clubs where you have to be vouched for by other members of the club to be able to join.
At least with the Chargers there still is an atmosphere, just one that the visiting team fans are creating. That's great, because it's exactly what Spanos deserves.
He doesn't care... their money is just as green...
You have to do non-price rationing in some way, and that's hard.
The Sixers also re-sell their tickets directly on Ticketmaster to capture the after market profits which is off-putting in the local market. But I think the easier explanation is playoff scarcity. This is the Knicks first title-chasing team in at least 10 years. So thirsty Knicks fans are willing to pay top dollar in NYC or travel the short distance to Philly to get much cheaper tickets. A couple of years ago after a decade of truly miserable Phillies teams, in 2022 Phils fans were able to fly to Houson, get a hotel, and World Series ticket for less than going to a home game.
Also any slander against Joel Embiid's name is outragous. The man has one leg, is half-paralyzed, and still put up a triple double.
Knicks also have a bigger fanbase that can easily travel to Philly and is accustomed to paying much higher prices in MSG
Fair point on the playoff scarcity, but it flies in the face of what Philly sports fans tell themselves and the world. If you want to make the claim that you're more passionate than other cities, better show up.
What Embiid is doing this week is impressive, no doubt. He and Maxey have essentially kept them in each game by themselves. But what about literally every other season? He gets worked by Al Horford in every Celtics playoff matchup. Couldn't beat Kawhi and Toronto. Couldn't beat Butler and the Heat. They couldn't even beat the Hawks! At some point, you've got to deliver.
Sixers are a distant third in Philly fandom support and this is their 7th year in a row in the playoffs, and with yet another impending playoff exit. The frustration is aimed at the organizational level and general disgust with former coach Doc Rivers. Embiid is the best player in the NBA when healthy (enormous caveat,) and Maxey is becoming transcendant. Everyone else is replaceable. Philly has a rich basketball history but it has been a frustrating time to suffer under the years of tanking and the unmet expecations of The Process. If passion is defined by after market ticket pricing/scarcity, then Eagles fans have a solid argument as the top NFL fanbase, and Philles fans absolulely are the best crowd come playoffs.
Embiid is nowhere close to the best player in the NBA even when healthy. Jokic, Doncic and Giannis are all a cut above, and you could argue that Brunson, Tatum, SGA, and even Anthony Edwards have surpassed him this year.
You're spot on with the Philly sports hierarchy. I might argue that the Steelers have a larger and more passionate NFL fanbase but that's nitpicking; the Eagles are in the conversation. It's interesting though, 30 years ago you might argue it would be Washington, but terrible ownership, a lousy team, and dumb stadium decisions have wrecked them. Nobody should take this stuff for granted. Hell, even the Giants and Jets are showing warning signs for similar reasons (albeit not nearly as bad on the ownership front). The Eagles fans have it pretty good!
"Embiid is nowhere close to the best player in the NBA even when healthy. Jokic, Doncic and Giannis are all a cut above, and you could argue that Brunson, Tatum, SGA, and even Anthony Edwards have surpassed him this year."
Jokis is clearly the best player in the league. I could see the argument for Doncic and Giannis being in the same tier as Embiid, but I think comparing a healthy Embiid to Brunson, Tatum, SGA, and Ant is completely wrong. They are amazing players in their own right, but none of them has even close to the impact that Embiid has when healthy. He's better than all of them except SGA on offense, and more impactful than all of them on defense.
His biggest drawback is that he's so big and the way he play's its hard for him to stay healthy, but when healthy its clear why its been Embiid and Jokic competing for MVP over the last couple of years.
I'll grant you the defense, but there's no way he's more impactful than any of those guys on offense. Other than Doncic (who's a universe to himself), all of those guys make their teammates much much better! Embiid can put up a 40/15 and nobody would blink an eye, but it's all empty calories unless he carries them to some playoff wins (again, this year aside, where he truly has no help other than Maxey).
I'll put it another way -- would any of those other teams trade their superstar for Embiid straight up, contract aside? Not a chance. Would the Sixers trade him for any of those guys? Morey would do it in a heartbeat.
I think that's generally true especially since basketball arenas have pretty limited seating but there are times when teams (especially in baseball with bigger stadiums and more games) are not really willing to sell tickets at a lower price when demand is down and would rather them be empty, so you have to go to the secondary market to see if any ticketholders are panicking and are willing to bit the bullet and take a loss rather than get nothing.
Well, now I feel dumb. Are tickets for regular season tickets a lot cheaper in Philadelphia too? My husband is a big Sixers fan, but we live closer to NYC, so I got him and my daughter tickets for a Sixers-Knicks game for Christmas. Weekend Knicks tickets were cheaper than weekend Nets tickets when I bought them.
Well if you're in NJ (I assume), you can take NJ Transit right to Penn Station and come out right at MSG, whereas you'd have to drive to Philly and park. The price difference probably isn't that significant for regular season games either.
If you can take NJ Transit, you can also take NJ Transit plus Septa rail (or Amtrak only), plus subway to Philly.
You could, but the transfers aren't timed well and it would take you a long time (and Amtrak is expensive enough to make gas/parking/tolls worth it for the convenience).
"You could, but the transfers aren't timed well."
NJT lists SEPTA connections in its Northeast Corridor Line timetable. SEPTA doesn't list NJT connections in its Trenton Line timetable.
If you are one of the lucky ones to get Taylor Swift tickets for $50 when the market-clearing price is $1000, you *are* paying a thousand dollars for those tickets. By not reselling the tickets, you are exchanging $1000 (technically $950) of your now higher net worth - for the opportunity to see the concert just like those that paid the market price.
One of my daughter's friend's mom scored tickets for herself, my daughter's friend, and friend's older sister. The friend sold his ticket another friend for $500, paid his mom back the $50 and pocketed the rest.
>I mean this all 100 percent seriously: Restaurants should charge for reservations<
And I agree with you 100% seriously. They should!
Also, Robert Reich (I'm mainly exposed to his thoughts these days via his Guardian pieces) strikes me as a guy who really values high fives from lefties a lot more than he cares about being accurate. I totally get a "He can't possibly sincerely believe what he just wrote" vibe from him.
Robert Reich's son Sam Reich runs a lovely little streaming service called Dropout (which rose from the ashes of College Humor, for those familiar). It's the best $6 a month I pay. Free advertisement over.
Yeah some funny content on there.
He's been there the whole time.
(Also, seconded)
Really? Interesting.
Given how consistently wrong Robert Reich has been for the last 30 years, I have to presume he's sincere.
I vaguely recall him as a sensible neoliberal shill (like me) two odd decades ago. I mean, he did work for Bill Clinton! But maybe I'm misremembering...
OK, I'll acknowledge that "30 years" is wrong -- I doublechecked and he did defend free trade early in the first Clinton administration, but he published "Locked in the Cabinet" in April 1997, so there's not a very large window there.
I used to see him at the Starbucks on Wisconsin Avenue near Porter Street in those days. He was always approachable and would grin conspiratorially when teased about the contrast between his expressed views and administration policies. Bottom line: he hasn’t changed much except now he doesn’t need to be conspiratorial.
I loved this line: “a guy who really values high fives from lefties a lot more than he cares about being accurate.”
It was completely unsurprising when he came out as a huge nimby
You may actually be conflating him with Larry Summers — I say this because I thought they were kind of the same guy as a kid.
This made me laugh. I am picturing a kid looking at economist trading cards (my husband got a pack of them when he worked for an economics consulting firm) while his classmates are trading their Pokemon and Bakugan cards.
I've got a mint condition Franco Modigliani I'm selling on Ebay.
Sadly, I wasn't quite a kid when Reich ran the Labor Department.
I hadn’t been born yet
Two decades ago is well into W’s Iraq war now…
No, you're remembering correctly. Of course, it's possible that his shill period was the pose. That is when he made his name.
Fair.
Not just wrong but also extremely annoying and self righteous while simultaneously being colossally wrong.
Exchanging a high five with a leftie is filled with peril as most of us are trained to do the dominant "right hand/right hand" high five. Good chance of just missing that left hand entirely.
Ouch.
Reich is a NIMBY in Berkeley who fights affordable housing being built nearby because it might affect is view and make it harder for him to drive his car to the weed dispensary.
This is by far not the worst thing about him. But yes, an absolute joke of a person.
Oh wow. Got some articles to read up on this?
https://twitter.com/daguilarcanabal/status/1291235780493377536
Thanks. Always sad to see how so many ostensible egalitarians end up succumbing to selfish NIMBYism.
Unlike some of Matt's other examples, great Carbonara is not in short supply. A table at Roscioli may be in short supply, but that is simply an issue of perception, not great Carbonara. As someone who works with the industry in NYC, there is an oversupply of great restaurants with great chefs cooking great dishes that anyone could get a table at on any night, without having to pay for a reservation. These restaurants are closing down all the time, because too many people are following the herd to Roscioli rather than exploring on their own. In fact, in the industry, if you wanted to debate where the best Carbonara is, for some, Roscioli may not even make the list. This isn't too say they shouldn't be able to charge wealthy people to buy out Roscioli's tables on demand, just as wealthy people can overpay for a bottle of Pappy Van Winkle whiskey. This is only to say that again, anyone wanting good Carbonara would be foolish to pay extra for that experience at Roscioli (or should just go for lunch!), whereas someone wanting to experience Taylor Swift should pay as much as possible for that experience, as nobody else is capable of providing it.
Also, as Matt only briefly touched on, the short supply of tables is mostly a matter of the top restaurants creating that short supply intentionally (holding tables in reserve for VIPs, celebrities, businesses, credit card promotions, or simply to create the image of being the kind of restaurant that is popular enough to have limited supply). In this, the system that Matt describes already exists, only behind-the-scenes. If you want a table at Roscioli on a Friday night, there are people to call and money to spend. Hedge funds can find a table anywhere they want, because restaurants know they will buy the $5000 bottles of wine. They don't need to pay for the reservation on top of that. Roscioli does not need a secondary system to make extra money for reservations there - they already have a system for that. Matt is arguing that the rest of us rubes should get access to that system, but that system also already exists - As he mentions, there are sites that offer restaurants the ability to sell seats at their tables (i.e peakreservations.com) and trade reservations, should Roscioli want to do that. But their system is working fine for them - just not as much for us.
The overall point being Roscioli and other high-profile restaurants do not need this system, or extra profit. The better option for restaurants (and customers) is to widen their knowledge of restaurants beyond Google and support the industry in general.
Amen. I don't live in a city with high-demand restaurants frequented by hedge fund managers, but we have the same phenomenon of people sticking to a handful of popular restaurants when there are so many equal or better restaurants that you can often just walk into and get a table. This is only amplified in a place like NYC.
I am in NYC every month or two - so I know the city fairly well, but not well enough to be aware of hidden gems. Do you have a recommendation for a resource to find good but undervalued restaurants? Lately, I have been taking the train to Sheepshead Bay and trying whatever cuisine I can't easily get at home, but it would be good to be a little less random.
"I am in NYC every month or two - so I know the city fairly well, but not well enough to be aware of hidden gems."
Surely the number of people who know the entire NYC restaurant scene can be counted on one's hands. Perhaps a few toes, if necessary.
The Infatuation stays on top of new restaurants here with a wide and honest filter ... People in the industry generally rely on it: www.theinfatuation.com/new-york
More simply, restaurants that are fixed-price menu only are effectively charging for the seat as well as the meal.
Yeah this all just seems bizarre to me and more of a status thing to get into certain restaurants.
I am so uncool and out of touch and uncultured flyover swine that the idea of booking a reservation and then trading or selling it never occurred to me. I don't know when I last made a reservation at a restaurant, if I ever have.
I liked Matt's article today, but reading it gave me hives.
It's obviously a very rare local experience for most people, but Matt was able to springboard this off to more familiar experiences like live entertainment. And of course, this was a subtext to make the argument as to why rent control is bad, similar to his water pricing article which was a subtext to again advocate for a Pigouvian tax on GHG emissions.
Back in the dark ages, when people would sometimes call restaurants on the phone, it was well known at the fancy law firm where I worked that if you wanted a reservation at a hot restaurant you would have much, much more success calling from our desk phones than from your cell or home number. I used to get same-day reservations at Danny Meyer restaurants etc. on Friday nights through the magic of caller ID.
Totally off-topic, but I followed the Serious Eats advice (and then made some tweaks to match my preference) a few years ago, and now prefer my own carbonara better than any I've had at a restaurant - and I've worked and dined (and eaten carbonara) at some pretty darned high-end restaurants. (Maybe whatever NY restaurant I've never heard of has some special secret, but I doubt it.)
Anyway, my point is that I have no problem with paying a significant sum for Special Meals at reataurants, but I have even more fun to learning to cook the "easier" dishes myself, and saving my dining out $$$ for things which (for technique or equipment reasons) are beyond my ability to create for myself.
Also, carbonara isn't all that difficult. Give it a try!
For "perishable" goods like concert tickets, reservations, etc., I'm a huge fan of Dutch (reverse) auctions as a way to establish market clearing prices, but those are sadly almost never used for reasons discussed in the article. I remain convinced, however, that the person who develops a user-friendly on-line Dutch auction system for concert tickets will make billions.
BGGCon ( a board game convention I attend annually ) used this when they first sold premium badges. They started at $1000 /badge I think and said they would lower them $50 / day until they sold out (or hit a floor price of $300)
https://boardgamegeek.com/thread/1714538/announcing-bggcon-premium-badges
And then I believe they used the pricing from that to price them in the future.
Of course leave it to game designers/players to use this method.
That's very clever! (I've been using BGG for 10+ years, but hadn't been aware of that because I don't really pay attention to the con stuff.)
I've thought that a software system that allows bidding on pay for shift work would be useful for businesses that have a lot of fungible employees and that stay open on undesirable times.
Like at the beginning of each quarter shift bidding starts, proceeding by round. In the first round every shift pays some low amount. After 24 hours round 2 starts, with every remaining shift paying an additional 15% or so. Keep starting new rounds with higher prices until every shift is filled.
I could see this being useful for airline crew and hospital employees.
I like that, although the problem I immediately see (besides labor union opposition) is that the kind of jobs that involve shift work also typically are jobs where people would expect to earn a predictable income each month (as compared to gig workers, salesmen on commission, etc.). Also, unless you're dealing with a really big pool of workers, it seems like it's open to be gamed by the workers just all agreeing to withhold their bids for the first three rounds or something to drive the price higher.
Oh, definitely. This requires probably minimum fifteen or so fungible workers and anonymous bidding so that defection from collusion is easy.
I would be interested in the income predictability. My guess is that the biggest source of drama will just be that a system like this feels unfair to people who aren't very time-flexible, like parents.
I knew that this would be your top level comment.
Someone has to speak for the Dutch auction and, if not I, then whom?
I don't know whether it's been empirically tested, but I have a suspicion that in many cases if restaurants started charging market-clearing prices for bookings, the market-clearing price would be rather lower than the huge unmet demand for tables implies.
A little like the most expensive Ferraris and the Birkin bag, the fact that it's difficult to buy is a not insubstantial part of the appeal.
Where the analogy breaks down is how the owners cash in on the brand their sold-out restaurant creates. In the case of Hermes and Ferrari, you have to be a "good customer" and buy some of the less desirable (but still supremely expensive) gear to get the Birkin or the Daytona SP3. That doesn't directly translate to the restaurant scene.
In some cases, celebrity restaurateurs will open additional, more accessible venues; in some cases they sell cookbooks or make TV series, or get paid handsomely to replicate their New York restaurant in, say, Dubai.
I am frequently surprised how seldom actual lotteries are used. One event I participated in (National Homebrew Competition circa 2018) had limited capacity for entries, and money wasn't at all the point, so they had a two-week window to register for the lottery, and then did a random drawing to allocate entries to prospective participants.
Random allocation seems substantially better than "who can be online at the right moment and click the fastest".
Occam's razor suggests that the reason why, for instance, The New York Knicks don't do a lottery for tickets to the games is that everyone involved in the operation of the league and the venue is perfectly happy with the current system of 70% of the tickets being purchased for the purpose of being resold. And to some extent, the fans are fine with it too: Season ticket holders like reselling their tickets for profit, and fans like the flexibility of being able to buy tickets to whatever game they want as long as they're willing to fork over the cash.
You can still do that with the lottery!
True! Though if you allocate the tickets via lottery but allow resale in the same way as it happens now, is there really a functional difference between that and the current system where you open like 22 browser windows when tickets go on sale and hope you get lucky?
Absolutely! With the pure lottery, everyone who wants only spends a few seconds of time. With the current system, millions of people waste half an hour setting up their browser and camping out and rescheduling things they might have done precisely at the relevant time. The pure lottery is much more efficient at not wasting people’s lives.
Fair enough! I'd be fine with it. My preferred system, at least for a sports standpoint, would be to do the lottery for a certain portion of tickets but to ban those from being resold, and have the lottery be for people who pay a nominal fee to be 'club members' - a chance to get tickets into the hands of people who are fans of the team, but still allowing some of the tickets to be resold if that's what people want. But I don't think there's a 'right' answer, and I can obviously see a lot of people being outraged at the idea of paying $20 a year or whatever to be an Official Knicks Fan for the purpose of being able to enter into a ticket lottery with no guarantee of ever getting them.
I'm a Manchester United fan, and I live within walking distance of the ground. Costs me £40 a year to be a member so that I'm allowed to enter the ticket lottery.
Of course, English soccer, because of violence between fans, has had to have incredibly strict rules about purchasing tickets: you have to list the names of all the people you are buying for, they all have to have memberships, and if their ID doesn't match the name on their membership / their ticket, they will not be allowed into the ground.
Even in corporate hospitality, being a fan of the away team is going to get you in trouble: if you start chanting or you're wearing an away team shirt, even if you're in a private box, you'll get ejected at least, and probably arrested.
I think a lottery would also be fairest criteria for college admissions. Each university states clear, objective admissions criteria (e.g. test scores at least X, GPA at least Y), removes all the subjective stuff (e.g. essays) from the applications, and everybody who meets the qualifying criteria gets entered in a giant lottery, with admissions offers given to the winners. As offers are turned out, more names are drawn, until the entire freshman class is filled.
Of course, there are very clear and obvious reasons why no university will ever actually do this. It would destroy the mystique of choosing the best of the best. But, I think it would definitely be fairer than the current system.
Something like that would definitely be good for most grant applications. You couldn’t remove the subjective aspects, but you could stop the committee from spending hours arguing about the fine differences among marginal cases, and ensure that only the clear differences matter.
In 2005, my local MLB team used a lottery to determine which non-season-ticket-holder fans would have the right to purchase world series tickets for the face-value price of $125/ticket. (I won the lottery to purchase game 5 tickets, but the game was never played because the team got swept in 4 games; even though the base price of the tickets was refunded, I still lost about $20 in Ticketmaster fees, which was not; the way Ticketmaster gouges its customers is truly outrageous).
Isn't there a danger you run into gambling regulations or laws?
Is the "greed is good" speech so bad? I don't think greed is always good, but in the context in which Gekko is talking- investors taking over a poorly run company/shareholder activism- well, greed can clarify, can't it?
You wouldn't want to run your whole society on Gordon Gekko's ethical principles. But greedy investors have a role to play. That doesn't have anything to do with restaurant reservations or Taylor Swift tickets, of course.
I’m a bigger fan of the Larry the Liquidator speech from Other People’s Money: https://youtu.be/JOcz-H5u3Rk?si=z0ZOD1tVcShR_Hqe
That one's good too.
Indeed, a few days ago *someone* posted that having a clear corporate mission is good, because it clarifies things.
I know well that markets work, yet I don’t like it when expanding them threatens to put goodies I enjoy out of reach. It takes a lot of self discipline/humility to admit “rich people can outbid me for things I would appreciate much more.”
It is not the "market" that puts it out of reach it is that price rather than bad luck/inconvenience puts it out of someone's reach.
For an individual good yes. But if I have 10 chances at spending money on shows a year, if they're too expensive I will go to 0 (the value of the show is < the value of the money). If they're less expensive I might _want_ to go to all 10, but due to competition/bad luck I only get to go to 1 ... but I only _spent_ the money on 1 so I'm better off. (assuming queueing for tickets itself isn't massively onerous - just entering a lottery)
:)
This is sort of like my argument that low income workers (and people who want to transfer income to them) can rationally support minimum wages (although not why in comparison to a higher EITC) even knowing that the amount of labor demanded will decrease. Each worker has a rational expected value of an increase.
This is my continual economic gripe about skiing. Everyone, including reporters, continues to complain that’s both too crowded and too expensive.
I've really wondered how skiing would change if the Epic and Ikon megapasses went away and everything was on mountain-specific passes or lift tickets.
My bet is more mountains would just close. Skiing is just a bad business, with high-fixed costs and highly weather dependent revenue. The nation-wide pass is way of hedging against bad-weather in one specific region.