Working Paper: CEPR ID: DP3443
Authors: Pascal Courty
Abstract: This Paper studies a monopolist selling tickets to consumers who learn new information about their demands over time. The monopolist can sell early to uninformed consumers and/or close to the event date to informed ones, it can ration tickets and allow ticket holders to resell. I show that rationing and intertemporal sales are never optimal. More surprisingly, the monopolist cannot do strictly better by allowing resale despite the fact that consumers are willing to pay more when they can resell tickets. I discuss the implications of the model for the pricing practices observed in ticket markets.
Keywords: price discrimination; resale; ticket pricing
JEL Codes: D42; L82
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Timing of sales (C41) | Revenue outcome for the monopolist (D42) |
| Monopolist's strategy (L12) | Consumer surplus (D11) |
| Monopolist's strategy (L12) | Overall market efficiency (G14) |
| Resale option (G13) | Monopolist's profit-maximizing strategy (L12) |