Why were FIFA World Cup tickets so cheap? Monopoly pricing, demand quality and two-sided markets

Christoph Eichhorn and Marco Sahm

Journal of Economic Psychology, 2010, vol. 31, issue 2, 212-217

Abstract: We examine the pricing decision of a multi-product monopolist in a two-sided market with capacity constraints where the type structure of buyers on one side is an important determinant of profit on the other side. Prices below the maximum sellout price and rationing demand in the first market might be optimal to reach a demand quality, i.e. a type distribution more favorable for sales in the second market. The model explains frequently observed underpricing and resale deterrence, e.g. in the (sports) entertainment industry, where the spectators' extraversion is negatively related to their income and serves as an input factor for sponsors.

Keywords: Underpricing; Demand; rationing; Extraversion (search for similar items in EconPapers)
Date: 2010
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:joepsy:v:31:y:2010:i:2:p:212-217

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