Inelastic sports pricing

Rodney Fort
Additional contact information
Rodney Fort: Department of Economics, Washington State University, Pullman, WA 99164-4741, USA, Postal: Department of Economics, Washington State University, Pullman, WA 99164-4741, USA

Managerial and Decision Economics, 2004, vol. 25, issue 2, 87-94

Abstract: A recurrent finding in estimates of the gate demand for sports events is pricing in the inelastic portion of demand. With few exceptions, this finding has either been ignored or (rather poorly) explained away. In this paper, the recurrent outcome is detailed and the explanations given by past authors are discussed. Then, profit maximization theory is explored for its inelastic pricing implications. It ends up that the local TV revenue relationships between MLB teams satisfy the situation that theory predicts would generate inelastic gate pricing. This suggests two things. First, inelastic pricing is consistent with profit maximizing team behavior. Second, fuller specification of revenue functions will enhance future work in the area. Copyright © 2004 John Wiley & Sons, Ltd.

Date: 2004
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (34)

Downloads: (external link)
http://hdl.handle.net/10.1002/mde.1108 Link to full text; subscription required (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:wly:mgtdec:v:25:y:2004:i:2:p:87-94

DOI: 10.1002/mde.1108

Access Statistics for this article

Managerial and Decision Economics is currently edited by Antony Dnes

More articles in Managerial and Decision Economics from John Wiley & Sons, Ltd.
Bibliographic data for series maintained by Wiley Content Delivery ().