Written by: Noah O'Neal
Our beloved Milwaukee Bucks have been on a speeding train throughout this entire season. Every team the come across, they seem to have some kind of answer and won about 75% of their games in the regular season. Not only were Bucks a force to reckon with in the regular season, but they have stayed on that speeding train so far in the postseason. Throughout the postseason it has became harder and harder for fans to get tickets to the games. The demand for these tickets grew, but the supply did not, there are only so many seats in the brand new Fiserv Form. 17,500 to be exact. As the demand for play off tickets grows, along comes quite a large price tag. The Bucks are just games away from the NBA Finals, and with home court advantage, those ticket prices will only get higher.According to StubHub.com, the cheapest tickets you can get for game one of the Finals cost $446.00 for each ticket and that for standing room only. Let’s say you actually want a set though, you are now looking at $500 for arguable the worst seats in the house. Some might say there is no bad seat in the , but let’s be real, it would be better to just watch the game on TV. StubHub also says that courtside tickets are expected to start at $6,000.00 each. This would put you on the court, row 1, right under the hoop. Now let’s look a little deeper into the economics behind all of this. Why would someone pay $500 to barely see the game. Or why pay $6,000 just to watch a two hour basketball game. Also, how do owners determine the prices of each ticket?
Finals tickets are an inelastic good. The increase in prices causes less then a 1% change in the quantity demanded meaning it’s inelastic. People will still pay observed amounts of money to see these games because quantity is limited. This tells owners that they can raise the prices of tickets and people will still come and buy them. But now the question is, how high is too high for ticket prices? This is where they factor in marginal utility. Marginal utility is a way to determine how much satisfaction a customer will receive from a product. This is why that the worst seats in the house are still so expensive. Even though that person can barely see the games, they are still satisfied with spending $500 just to be at the NBA Finals and get to cheer on their Bucks. This also applies to the person sitting under hoop. They are satisfied with paying $6,000 for those seats because the marginal utility received is worth $6,000 to that sold out fan. Also now a broke sold out fan.So, throughout the rest of the NBA Finals, and other big events, look closer at the big price tag on tickets. The prices rise because they are an inelastic good, and the supply is limited. They also go up because the marginal utility is greater than a typical games, and lastly the fact that some people just have way too much disposable income.
Works Cited
Durst, Nicholas. “DGS Staff Predictions: Who Will Win The 2019 NBA finals? • Double G Sports.”Double G Sports, 5 May. 2019, doublegsports.com/who-will-win-the-2019-NBA-Finals/.
“StubHub!” StubHub, www.stubhub.com/milwaukee-bucks-fiserev-froum-10-23-2018/event/103753469/?sort=quality+desc&tktbkt=1.
I agree with you that the tickets are an inelastic good and the supply of them is unlimited. It is crazy how expensive these tickets can get up too. But some people are willing to pay this much money for the tickets to watch the Bucks play. Fans are excited because the Bucks haven't made it this far in years so people are more willing to get courtside seats even if they are expensive. It is smart to price the tickets higher as the Bucks make it farther and farther because people will want to go to the games and support their team, and will be more willing to purchase an expensive ticket. This is also a good opportunity to get advertisements out on television because there will be more and more people watching these games as it gets closer to the finals.
ReplyDeleteIt is interesting to think about how almost every sporting event has a limited supply, however the Milwaukee Bucks tried to take matters in to their own hands and try to solve this limited supply by having a large block party right outside of the stadium. Also, not only does the Milwaukee economy thrive through increased sales in stores, restaurants, hotels, etc., but those who have season tickets for the Bucks game are also at an advantage as they can sell their tickets for much higher than face value, making a profit from their original purchase. Hopefully, the Bucks will continue on in the postseason as well as return next year as a well oiled machine, that way Milwaukee stays on the map as a city on the rise.
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