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Monday, March 19, 2001

Salon.com News Sports Econ 101

Allen Barra, a cohort of ESPNer Rob Neyer, has a dead on take of ticket prices and player salaries and the lack of correlation between the same.  Print this out, put it in your wallet and carry it around.  Because if you talk baseball with random folks over the next year, you are going to need it.  The article is from last summer, but it still applies to A-Rod and anybody else.

Sean Forman Posted: March 19, 2001 at 10:52 PM | 2 comment(s) Login to Bookmark
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   1. The Original Gary Posted: March 20, 2001 at 12:44 AM (#66077)
I know I slow sometimes, but I don't understand how ticket prices are not related to salaries. Sure, it is all about supply and demand and the owners will squeeze every last penny they can from the paying public. Still, it doesn't take a math major to figure out that 2.5 million fans who pay $20 per ticket generate twice that of the same number of fans who pay $10. In this example, there is a 25 million dollar difference. Heck, that gets Arod for a whole season! If a team generates that much more revenue, obviously there is that much more to spend on players. Attendance figures have a bearing on payroll. Low attendance equals low vendor sales. Less income is generated from parking. It is all interrelated.

I don't feel that because the Texas Rangers spend all that loot on Arod means they have to raise ticket prices to pay for him. But, if your payroll is 90 million, and you can generate more money by raising ticket prices to maintain that payroll, then the two are indeed related.
   2. The Original Gary Posted: March 20, 2001 at 12:44 AM (#66337)
I know I slow sometimes, but I don't understand how ticket prices are not related to salaries. Sure, it is all about supply and demand and the owners will squeeze every last penny they can from the paying public. Still, it doesn't take a math major to figure out that 2.5 million fans who pay $20 per ticket generate twice that of the same number of fans who pay $10. In this example, there is a 25 million dollar difference. Heck, that gets Arod for a whole season! If a team generates that much more revenue, obviously there is that much more to spend on players. Attendance figures have a bearing on payroll. Low attendance equals low vendor sales. Less income is generated from parking. It is all interrelated.

I don't feel that because the Texas Rangers spend all that loot on Arod means they have to raise ticket prices to pay for him. But, if your payroll is 90 million, and you can generate more money by raising ticket prices to maintain that payroll, then the two are indeed related.
   3. The Original Gary Posted: March 20, 2001 at 12:44 AM (#66877)
I know I slow sometimes, but I don't understand how ticket prices are not related to salaries. Sure, it is all about supply and demand and the owners will squeeze every last penny they can from the paying public. Still, it doesn't take a math major to figure out that 2.5 million fans who pay $20 per ticket generate twice that of the same number of fans who pay $10. In this example, there is a 25 million dollar difference. Heck, that gets Arod for a whole season! If a team generates that much more revenue, obviously there is that much more to spend on players. Attendance figures have a bearing on payroll. Low attendance equals low vendor sales. Less income is generated from parking. It is all interrelated.

I don't feel that because the Texas Rangers spend all that loot on Arod means they have to raise ticket prices to pay for him. But, if your payroll is 90 million, and you can generate more money by raising ticket prices to maintain that payroll, then the two are indeed related.
   4. The Original Gary Posted: March 20, 2001 at 12:44 AM (#67663)
I know I slow sometimes, but I don't understand how ticket prices are not related to salaries. Sure, it is all about supply and demand and the owners will squeeze every last penny they can from the paying public. Still, it doesn't take a math major to figure out that 2.5 million fans who pay $20 per ticket generate twice that of the same number of fans who pay $10. In this example, there is a 25 million dollar difference. Heck, that gets Arod for a whole season! If a team generates that much more revenue, obviously there is that much more to spend on players. Attendance figures have a bearing on payroll. Low attendance equals low vendor sales. Less income is generated from parking. It is all interrelated.

I don't feel that because the Texas Rangers spend all that loot on Arod means they have to raise ticket prices to pay for him. But, if your payroll is 90 million, and you can generate more money by raising ticket prices to maintain that payroll, then the two are indeed related.
   5. The Original Gary Posted: March 21, 2001 at 03:20 PM (#66080)
Vinay, you have crystallized my thoughts eloquently. Like I said, I am slow sometimes.
   6. The Original Gary Posted: March 21, 2001 at 03:20 PM (#66340)
Vinay, you have crystallized my thoughts eloquently. Like I said, I am slow sometimes.
   7. The Original Gary Posted: March 21, 2001 at 03:20 PM (#66880)
Vinay, you have crystallized my thoughts eloquently. Like I said, I am slow sometimes.
   8. The Original Gary Posted: March 21, 2001 at 03:20 PM (#67666)
Vinay, you have crystallized my thoughts eloquently. Like I said, I am slow sometimes.

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