Why Is Ticket Scalping Illegal?

Question

The event coordinators get what they want, and if the scalper can't sell them he loses money. If I purchase the right to sit in a certain seat, why can't I sell my right to the highest bidder? It's not like buying a CD, copying it, and selling multiple copies. I'm not mass producing, but I am buying and selling much as I would if I bought real estate and turned it for a profit.

Answer 1

Because you're not paying taxes on the increased return you make on the tickets. Actually its perfectly legal for you to sell your tickets right outside the venue as long as you sell them for the ticket price.

There's also nothing wrong with reselling tickets for a profit, that's what ticket brokers do. They just do it legally.

Answer 2

Is Scalping Tickets Illegal

Answer 3

Is Scalping Illegal

Answer 4

Because then neither the state nor the event coordinators get a cut of the increased price.

Scalping is essentially a free-market street-corner commodity futures market. The scalper has taken the full risk - he has purchased the tickets - paid the investment price - on the prospect that he can make a future profit from their sale. He's taken all the risk, like any other investor. But the government is upset they cannot tax his capital gains. This is the big reason.

Sad, isn't it, that the government that was set up to protect our rights and individual freedoms is now intruding into every little bit of our lives with rules and regulations, controlling our lives and controlling the 'free' market.

Answer 5

You are talking about ONE ticket.. the link below actually discribes what Scalping is....This report focuses not just on ticket scalping, but also on how tickets get from their original point of distribution to the resale market where they command such unconscionable and illegal prices, and how to assure increased access to tickets at reasonable prices to the large majority of the public.... see link below.

Selling a ticket to a friend, neighbor because you can't attend is different than Scalping... it is the entire process that will help you understand.

Answer 6

It is simply a form of price control; to prevent bulk buyers from tying up the supply of tickets to popular events & re-selling them to the highest bidders.

That business about the gov. losing tax revenue is bullcrap. The gov. would get the exact same taxes if tickets were scalped after sale or not; they collect the original tax amount on the first sale, whether the ticket is given away, resold at the same price or sold for ten times as much. In fact, the gov. could get more by charging a second sales tax on re-sales. Individuals could evade it, but big bulk re-sellers couldn't.

Answer 7

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RE:
Why Is Ticket Scalping Illegal?
The event coordinators get what they want, and if the scalper can't sell them he loses money. If I purchase the right to sit in a certain seat, why can't I sell my right to the highest bidder? It's not like buying a CD, copying it, and selling multiple copies. I'm not mass...

Answer 8

One of the basic principles in economics is that competititve markets generate price movements to bring quantities demanded into balance with quantities supplied so that queues will be quickly eliminated. Lines, therefore, are troubling to economists, especially when the lines appear repeatedly in what seem to be nonregulated markets. Why are price increases not more forthcoming?

Natural disasters create one such situation. Essentials like water are sold at ``below-market'' prices immediately after the disaster, as evidenced by long lines of consumers. A completely free-market solution would be to have many different firms supplying water at prices the market will bear. However, perceptions of fairness are so strong in natural disasters that price gouging is either illegal or heavily criticized by most consumers. Charging what the market will bear in the short run generates extremely adverse ``moral effects'' (Akerlof 1984) or ``reputation effects'' (Klein and Leffler 1981) in the long run. Because of consumer perceptions about fairness and moral treatment, below-market pricing continues--and queues remain for some time.

Another situation of persistent lines and strong feelings about equity is entertainment events such as major concerts or big-time sport championships. Well-known performers and certain games repeatedly have people lining up for tickets for the right to attend the live, one-time interactions. Again, why do promoters not raise prices at the time tickets first go on sale to prevent long lines? Are the lines rational in a market sense, helping to ration a scarce commodity? Further, why do many promoters and certain consumers become so outraged by the attempt to clear markets through ticket scalping? Currently 26 states, the District of Columbia, and most sports-league municipalities in the United States have some form of anti-scalping regulation, and three-quarters of the U.S. population resides in those locales. (See Table 1 for the states and cities involved.)

This paper examines the nature of major entertainment events, reviews the evolution of scalping statutes since 1918, describes various schemes for allocating tickets, considers the winners and losers in each scheme, and suggests some ideas about possible future scalping laws based on market principles.

Answer 9

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Because if it was legal , Would you not be the first in line and buy all the tickets and sell them at an outragous price ? That way you could get rich quick. Thats Why.

Answer 10

Scalping isnt illegal everywhere. The reason why is simple: the government loses tax revenue. When you buy a ticket for $100 and resell it for $1000, you do not claim the $900 profit on you income taxes, nor does the purchaser pay the sales tax on the transaction. By the way the failure to pay income tax is a felony. Scalping is only a misdemeanor.

Answer 11

Not taxes. Fraud. With completely unregulated ticket resale, counterfeiters can't resist the allure. So many municipalities just stop the problem before it starts and make ticket resale illegal from the get-go. (It's not taxes because scalpers actually increase tax revenue slightly by ensuring venues sell out).