Price discrimination and the emergence of secondary markets

Vlad Radoias ()

Managerial and Decision Economics, 2019, vol. 40, issue 4, 439-445

Abstract: A frequently used explanations for the emergence of secondary markets for live entertainment and the ability of resellers to charge a markup over face‐value prices is that promoters do not price discriminate optimally. We test this hypothesis empirically, using instrumental variables techniques on a sample of 45 popular music concerts and find that secondary market markups are not caused by the level of price discrimination used by promoters on primary markets. The experience and success of the artist drive both primary market pricing and secondary market markups, which are consistent with theories of social influence and pricing of complementary products.

Date: 2019
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https://doi.org/10.1002/mde.3013

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Persistent link: https://EconPapers.repec.org/RePEc:wly:mgtdec:v:40:y:2019:i:4:p:439-445

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