Economics

Shakespearean Economics

|

Every year, Washington, D.C.'s Shakespeare Theater Company puts on a free public performance featuring a stellar cast. In previous years, anybody who wanted a free ticket had to line up early. This year there will be an online lottery system to avoid long lines in the sweltering heat. The Pacific Legal Foundation's Timothy Sandefur explains what the whole thing reveals about basic economics:

They say on their website: "To enter the Free For All Lottery…Visit this page between midnight and 1 p.m. on the day of the performance. The lottery closes precisely at 1 p.m. You will be notified via email if you have been selected…."

Now, is this fair? A lot of people favor doing things this way rather than selling things because they think it's more fair than selling the tickets. But there's nothing fair about it—in fact, you're still basically selling the tickets, but for time instead of money. You're selling tickets to people who have the time to line up (or get on the website at the right time). People who have other obligations are out of luck. That system certainly does not get the tickets to those who ought to have the tickets—it gets them to the people who are able to stand around all day in line, or fool around on their work computers. That is not fair.

So we're left with the last alternative—a market economy. That is, an auction system. You sell the tickets. Then the people who want to go to the theater can decide for themselves how much they're really willing to invest in seeing the play. You eliminate from the crowd those people who don't really want to go that badly. The tickets go to those who place the highest value on them. In fact, no matter what you do, people are going to sell them anyway. If you randomly hand out the tickets both to those who do, and those who don't want to go to the theater, those who don't want the tickets will end up selling their tickets to those who want them really badly. This will happen even if you make it illegal to sell tickets—a black market.

Read the rest here.

Advertisement

NEXT: The Broadband Crisis: Who Cares?

Editor's Note: We invite comments and request that they be civil and on-topic. We do not moderate or assume any responsibility for comments, which are owned by the readers who post them. Comments do not represent the views of Reason.com or Reason Foundation. We reserve the right to delete any comment for any reason at any time. Report abuses.

  1. Shakespeare? That’s so pre-23rd century. Try live performances of Star Trek instead.

    Isn’t it odd how often we learn that the free market is a pretty decent way to distribute things?

      1. That’s right. How anyone else could play Khan is beyond me, but there it is.

        1. Armand Assante?

          1. Not Mexican enough.

            1. To play a Sikh.

              1. Exactly. Only a Mexican can play a Sikh warlord. Though he might not be a Sikh–the name is Hindu in origin even if particularly popular with Sikhs.

    1. Those guys are from Portland! Good find, Pro L. If they ever do a Seattle show, I am so there.

      1. I mentioned this to Episiarch a while back. Doubt he took the road trip, but you never know.

  2. Where the hell is today’s Brickbat?

    1. Thanks, but how did it get posted a 6am within the last hour?

      1. Time is relative.

        1. I think you misread Einstein.

          1. I live near a singularity.

            1. Is she hot?

              1. He does not, and can not, know.

                1. Awesome answer. I hereby adopt it as my own.

  3. Good if obvious point. I always get angry when people bitch about rock and roll acts charging huge prices for tickets to their shows. They are charging what people are willing to pay. If they charged artificially low prices, the scalpers would just sell the tickets at the higher price and make the money. Why shouldn’t the band make the money rather than the scalpers?

    1. I’ve bitched about how stupid people are to pay what they do for some things (driving up the price for the rest of us), but that doesn’t mean I want the Committee to decide on a “fair” price, either.

      1. All such a system would do is allow you to make the money that righfully belongs to the band. Let’s say you won the lottery to get to buy the tickets to the show for $20. And lets also say I am one of those people who annoys you and I offer $500 for the ticket. Chances are you will sell me the ticket and pocket the $480.

        1. What money “rightfully belongs to the band”? That makes no sense. If a band puts 1000 tickets on sale for $20, does $20,000 “rightfully belong to the band”? If they don’t sell any tickets, does it still? If it turns out people would happily have paid $40 per ticket, but the band didn’t know this, does $40,000 rightfully belong to the band?

          1. If you force the band to charge below market prices, the money made by the scalpers rightfully belongs to the band. And even if you don’t and they chose to charge low prices out of stupidity, it “rightfully belongs to them” in the sense that they could rightfully collect it if they chose and no matter who collects it it is they result of their labor not the scalper’s.

            1. —“If you force the band to charge below market prices”—

              If you “force” the band to charge below market rates, you are stealing from them.

              And who would be “forcing” the band to charge below market rate? If fans won’t pay over $40 for a ticket, that isn’t force, $40 is the market rate. If the band sells tickets for less than the market rate, oh well, they lose out on some money.

              1. I waiting for a band to do a tour selling on StubHub. Every ticket auctioned – so that they all go for exactly what people are willing to pay.

  4. That system certainly does not get the tickets to those who ought to have the tickets

    What defines those who “deserve” Shakespeare?

    1. It’s inversely correlated to the amount of god and guns one adheres to.

  5. There is one advantage that the article ignores. There are some people who value the ticket more than the money but do not have the money to bid. Those people would forgo selling them and keep their tickets. They value the ticket just as much as the person who buys them.

    1. There are some people who value the ticket more than the money but do not have the money to bid.

      Hence equilibrium prices are determined by what people are willing and able to pay.

    2. There are some people who value the ticket more than the money but do not have the money to bid.

      Those people are poor and therefore stupid and therefore worthless and should not be allowed to enjoy anything until they get up off their lazy asses and produce something.

      1. I’m pretty sure if you add up the nonessentials like beer, pot, other drugs, cigarettes, lotto tickets, cable tv, etc., most poor people in America have more than $500 to spare for a once per year Shakespeare performance.

        1. In what universe are beer and pot “non-essential”?

          1. $500 seems awfully low.

    3. It also ignores all the assholes in this town who could give a shit about Shakespeare but would pony up $500 to be seen at the right place with the right people.

      1. But is Shakespere where the assholes want to be seen? I would think the assholes want to be seen at Ben’s Chili Bowl or at some dumb ass urban hipster thing. I never thought of the assholes having such good taste. My wife and I go to the Opera and the Symphony a lot, and the tickets are pretty reasonable. It is just not a place to be seen.

        1. What’s funny is how little hipsters understand the value of not being seen.

          1. I think it is generally a pain in the ass to run into someone you know at a social function like a concert or ballgame. You talk to them and take time out of what you are doing. There is a lot to be said for not being seen.

            1. There are other advantages to not being seen.

        2. I’m talking about lobbyists and other assorted DC social climbers, not hipsters.

          1. Same thing.

          2. It usually a bunch of old people and a few college kids. I really don’t think the climbers hang out there.

    4. I’ve never understood this reasoning. If I handed that same guy $500, would he go buy a ticket to Shakespeare? The situation is exactly the same.

      When I was in college, I got Final Four tickets via the student lottery in a year when they were particularly valuable ($5K+ per person). My school ended up giving students vouchers that could be exchanged at the venue for tickets just before gametime (and tickets scalped at the door are far less valuable), so I missed my windfall. But the conversation amongst us fans was who would sell their tickets and who would keep them. My stance was simple – I would never pay $5K for basketball tickets (as a college student), so of course I would sell. “But you’re not paying for them, they’re free,” was the retort. But y’know what, that $5K I could sell them for spends just like if it had been in my bank account the whole time.

  6. All the world is a great stage and the sheople merely play[ed] upon it.

    1. All the world’s a phone booth these days.

  7. Proxies + multiple visits + increasing probability of getting tickets + craig’s list + time = profit

  8. Sandefur openly recognizes that the currency used is time rather than dollars, but then provides no argument for why that’s not a valid currency.

    The proprietors are selling on the basis of time. And not much of that, given that it’s any point within a 13 hour window.

    Totally disagree with the article. If everyone had the same wealth, then yes, price is the best way to sort out preferences. But wealth disparities make time a commodity that those of limited means can still trade as currency.

    I don’t see what’s not to like in lottery selectivity for tickets when the provider is unconcerned about maximizing revenue.

    1. Where’s Clich? Bandit when you need him?

      1. I’ll put up the Cliche bandit sign!!!

      2. Due to recent changes in public policy, the Bandit is required to work extra hard to make sure all the non productive parasites can get into shakespere concerts. He will be available for comments after the Krugpocalypse.
        How may I be of service Commisioner Gordon?

        1. I vaguely recall there being a well know statement regarding the equivalence or the temporal and the monetary but it eludes me now….

    2. whether you use time or money or any other means of exhange, some people are going to have more of it than others. Using cash bidding, those who are cash rich have a greater ability to pay. Using this systmem of waiting in line gives a greater ability for those who are time rich to pay. You got to not slip into the tendency that lberals fall into, that being that everything important in measuring society is that which is material (money).

      1. You got to not slip into the tendency that lberals fall into, that being that everything important in measuring society is that which is material (money).

        I didn’t slip into that. Sandefur did.

    3. The spent time is just gone, the theatre cannot use that time spent by the “free” ticket patrons for any capital improvements. It does not utilize the commodity exchanged efficiently.

  9. I would call this a non-issue. I will add it to my list of things I don’t give a shit about.

  10. What defines those who “deserve” Shakespeare?

    Saying “fair” nine hundred times in a post about Shakespeare without quoting Macbeth.

  11. How are they requiring payment in time? I thought this was a web lottery.

    1. You have to be able to allocate a portion of your time within a pre-specified window.

      Obviously, Sandefur has never had to by tickets to a popular event, which requires an even more exact allocation of time along with a $$$ commitment.

      It’s truly a ridiculous article.

    2. Because apparently 30 seconds to 5 minutes in a 13 hour window is somehow considered valuable?

      1. Well, if you were planning to be on a whitewater rafting trip in the mountains at that time (so that you cannot be at a computer), I’m willing to bet you’d be willing to trade money for that time, so yes, it is valuable in that sense.

        1. Blasted white water rafting trips!

          1. I just went on one of those with the kids on the Ocoee River in Tennessee. It was a blast, and I must say I thought it was worth the $40/person (it was actually a little less, but we bought the photo).

  12. What about people who pay somebody to stand in a line for them? Evil incarnate?

    1. 116

      Let me not to the marriage of true minds
      Admit impediments, love is not love
      Which alters when it alteration finds,
      Or bends with the remover to remove.
      O no, it is an ever-fixed mark
      That looks on tempests and is never shaken;
      It is the star to every wand’ring bark,
      Whose worth’s unknown, although his height be taken.
      Love’s not Time’s fool, though rosy lips and cheeks
      Within his bending sickle’s compass come,
      Love alters not with his brief hours and weeks,
      But bears it out even to the edge of doom:
      If this be error and upon me proved,
      I never writ, nor no man ever loved.

  13. I need a good book, any suggestions?

      1. Playboy: The Complete Centerfolds.

        1. Maybe he meant Good Book. Like he’s on a quest to renew his faith in the ineffable.

          1. Hey maybe he wants to take his talent to South Beach.

  14. To spend or not to spend isn’t even a question in this guy’s book.

  15. I don’t understand what a free one time special event has to do with fair market prices. I presume this is a bit of a marketing ploy by the production company. Give the consumer a free taste in the hopes they come back for more. Companies do this all the time, only difference here is the company is limited by the number of seats available. Besides what’s unfair about a free lottery?

  16. My wife and I go to the Opera and the Symphony a lot, and the tickets are pretty reasonable. It is just not a place to be seen.

    You’re welcome.

      1. Probably because the venue is likely subsidized.

        1. Actually other than performing in the Kennedy Center, which I think was built with public money, I do not believe it receives any subsidy. It is supported by ticket sales and private donations.

          1. He may also be saying that he’s contributing to the low turnout by not going.

            1. Everyone is always picking on the Opera.

              1. Opera? I thought you said Oprah.

              2. Well, all of it with the exception of some classical pre-Romantic era pieces (like The Magic Flute) are kitschy and manneristic to the point of hilarity, so I tend to prefer music that is more aesthetically balanced, like Pantera. When I’m in the mood for excess, Ian Hunter, or David Johansen are the order of the day, as they are at least aware of the comedy in their act.

                You are right about modern divas being smoking hot. I have met a few who have left me weak in the knees.

              3. It’s because of the fat lady.

                1. Oprah?

          2. The Kennedy Center receives a federal subsidy every year ($38 mil in 2007), for the building and grounds, which is US Parks property.

            The foundation itself, which puts brings in the shows, is funded by private donations.

  17. What’s worse, that Sandefur is an idiot or that he’s wasting his time arguing about something meaningless?

  18. I agree with the above who said this is a bad example of a good point.

  19. Well there is a certain mindset out there amongst some people who think money should have nothing to do with whehter people receive some good or service. They think it’s not “fair” that it does.

    This line of think especially comes out in arguments about Obamacare and socialized medicine.

    The leftists have a habit of using phrases like ” just because he (or she) happens to have money they can get care”.

    “Just happens to have money” – as if cash had just randomly fallen out of the sky right into someone’s lap and they had done nothing to earn it.

    1. 1

      From fairest creatures we desire increase,
      That thereby beauty’s rose might never die,
      But as the riper should by time decease,
      His tender heir might bear his memory:
      But thou contracted to thine own bright eyes,
      Feed’st thy light’s flame with self-substantial fuel,
      Making a famine where abundance lies,
      Thy self thy foe, to thy sweet self too cruel:
      Thou that art now the world’s fresh ornament,
      And only herald to the gaudy spring,
      Within thine own bud buriest thy content,
      And tender churl mak’st waste in niggarding:
      Pity the world, or else this glutton be,
      To eat the world’s due, by the grave and thee.

      1. racist

    2. “Just happens to have money” – as if cash had just randomly fallen out of the sky right into someone’s lap and they had done nothing to earn it.””

      It’s a shame that people that work hard get to enjoy the fruits of their labor.

      I love saying that to the free crowd.

      That and, too bad Robin Hood can’t steal it for you.

      I get the best looks using those lines.

  20. They should charge us to post… no wait, we should charge them for adding so much value to this blog.

  21. In today’s episode of “Great Moments in the History of the New York Times” we give you famed NYT film critic Bowsley Crowther commenting on the film “Mission to Moscow’s” treatment of the 1937 show trials.

    “Based entirely on the personal observations reported by Mr. Davies in his book, it will obviously prove offensive to those elements which have challenged his views. Particularly will it anger the so-called Trotskyites with its visual re-enactment of the famous “Moscow trials”…For it puts into the record for millions of moviegoers to grasp an admission that the many “purged” generals and other leaders were conspirators in a plot.”

    http://en.wikipedia.org/wiki/Mission_to_Moscow#cite_note-10

  22. John-
    I am assuming your “reasonably priced” opera tickets are a bargain because they do not represent they true cost of putting on the show. Costs shifted onto others, who couldn’t care less whether the fat lady sings.

    Hence, “you’re welcome”.

    1. “Costs shifted onto others, who couldn’t care less whether the fat lady sings.”

      How? They don’t receive any subsidies to my knowledge. They get a lot of corporate sponsorships. But if Lockheed Martin wants to support my Opera habit, that is their business.

      And opera singers are not fat anymore. They actually tend to be smoking hot these days.

      1. They actually tend to be smoking hot these days.””

        Rock of Ages isn’t an opera. 😉

        1. Gunter glieben glauchen globen

        2. Gunter glieben glauchen globen

        3. Ha ha – “Celtic Women”.

          It’s actually not so bad, once you hit the mute button.

    2. In DC, opera tickets do not receive a dime of guvmint support (aside from the occasional grant), ironically enough. In fact, it sucks ass as a business model. The cost of a ticket covers only about 40% of the production costs. The rest comes from fundraising. The opera pays rent at JKC.

      This isn’t to say they wouldn’t take guvmint money, they would in a second, but it ain’t there.

      1. They should join a union.

  23. Since it’s a free performance the theatre company could care less who gets the tickets. It seems that this way is a lot simpler for them than having to deal with a whole bunch of out of work people standing around all day.

  24. The reason you give free tickets is to give them the experience and hope they enjoy it enough to return and pay. You are trying to create or improve a customer base.

  25. Just to be clear people voluntarily giving out free shit is not fundamentally unlibertarian.

    Just saying.

  26. One of the few things I miss about not living in Northern Virginia – going in to DC for Shakespeare. That company is really terrific.

    The funny thing is that they kept trying to sell me season tickets for several years after I relocated to Norte Tijuana.

  27. I don’t know about Shakespeare, but I have a sudden desire to do all I can to “Change it Back” — almost subliminal.

  28. Tricky Vic is right that you build a customer base by giving out free tickets, and this online lottery system also helps build a customer base. If you want to be eligible for a free ticket, you have to give them your contact info, in a format that they can probably put into their databases without any further effort.

    There isn’t only one fair way to distribute tickets.

  29. the sweltering heat

    Heat schmeet. It’s that bullshit that kills you in that town.

  30. Besides I want to see a riot over free tickets to see Shakespeare.

  31. mark here FETUYUBDG

  32. it gets them to the people who are able to stand around all day in line, or fool around on their work computers. That is not fair.

Please to post comments

Comments are closed.