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Economics sometimes talks about markets as being similar to auctions. People decide on a “reservation price,” how much they are willing to pay for a product, and “bid” on it by either trying to buy the product or not buying it. This process continues until an equilibrium price, sometimes described as “Walrasian,” is reached. Such a price occurs where the quantity demanded is equal to the quantity supplied, and no further pressure is felt for prices to either increase of decrease. I found myself thinking of this recently when I became aware of the going prices for seats at the Cavaliers home games in the NBA playoffs, some of which will be held in Cleveland, Ohio.
I heard a discussion about the prices of these seats on the radio recently, and it seemed that the people who offered their opinions on the matter prefaced their opinions by explaining how old they were. Cleveland, Ohio has been without a major league championship for over 50 years, and it’s ever faithful fans are ready for things to change. We thought that we would experience a championship win in 1998, when the Cleveland baseball team showed promise on its way to the World Series. However, that did not work out, and Cleveland was left promising itself “wait ‘til next year.” Again, a trip to the NBA playoff finals in 2007 did not end in a victory. From what I heard on the radio, older Clevelanders were more willing to pay high prices for seats in the playoffs. They would begin their answer by saying “I am forty years old.” Indeed, a Cleveland team making it to the playoffs in a major league sport is what some have called a “once in a lifetime event.”
My daughter, an excellent basketball player and big Cavs fan, did get to go to a basketball game earlier this year, a game that turned out to be one of the few games that the Cavaliers lost. However, the experience of being in the arena with some of the hometown heroes was one that she will always remember. She wishes she could go to a playoff game when the games come back to Cleveland in a few days, but I am afraid that we, her parents, are unwilling to pay the going price for such tickets. The last time I looked, it seems that such tickets are selling for at least $400 each. Ouch!
I did get to go to an NCAA men’s basketball playoff tournament once when I was in college and that is an experience that I am very glad I had. I have to admit that I didn’t really realize what I was seeing when I witnessed it. We went to the playoffs expecting to see superior plays from one particular member of the opposing basketball team, but when the clock ticked down with only five seconds left, another member of that team, almost unknown to that day, made a basket from far across the court. It was the first such basket that this player, who became much better known in succeeding years, would make. When he, Michael Jordan, retired, he was heralded as one of the best basketball players ever. At the time, I was just sad that my team had lost the tournament. This time, the Cleveland team has a player that is already widely regarded as one of the best players in the sport at the moment.
Although we will most likely not be at any playoff games in person, we will be sure to watch the games together in our home. However, I am wondering what thoughts my readers have about what price they would be willing to pay for a seat at a championship game, a set of games that may well turn out to be, for those who live in Cleveland, Ohio, “once in a lifetime.” And, how would your age factor into determining this “reservation price?”
With economists everywhere, I mourn the loss of Nobel Prize winner John Nash this past week.
I heard a discussion about the prices of these seats on the radio recently, and it seemed that the people who offered their opinions on the matter prefaced their opinions by explaining how old they were. Cleveland, Ohio has been without a major league championship for over 50 years, and it’s ever faithful fans are ready for things to change. We thought that we would experience a championship win in 1998, when the Cleveland baseball team showed promise on its way to the World Series. However, that did not work out, and Cleveland was left promising itself “wait ‘til next year.” Again, a trip to the NBA playoff finals in 2007 did not end in a victory. From what I heard on the radio, older Clevelanders were more willing to pay high prices for seats in the playoffs. They would begin their answer by saying “I am forty years old.” Indeed, a Cleveland team making it to the playoffs in a major league sport is what some have called a “once in a lifetime event.”
My daughter, an excellent basketball player and big Cavs fan, did get to go to a basketball game earlier this year, a game that turned out to be one of the few games that the Cavaliers lost. However, the experience of being in the arena with some of the hometown heroes was one that she will always remember. She wishes she could go to a playoff game when the games come back to Cleveland in a few days, but I am afraid that we, her parents, are unwilling to pay the going price for such tickets. The last time I looked, it seems that such tickets are selling for at least $400 each. Ouch!
I did get to go to an NCAA men’s basketball playoff tournament once when I was in college and that is an experience that I am very glad I had. I have to admit that I didn’t really realize what I was seeing when I witnessed it. We went to the playoffs expecting to see superior plays from one particular member of the opposing basketball team, but when the clock ticked down with only five seconds left, another member of that team, almost unknown to that day, made a basket from far across the court. It was the first such basket that this player, who became much better known in succeeding years, would make. When he, Michael Jordan, retired, he was heralded as one of the best basketball players ever. At the time, I was just sad that my team had lost the tournament. This time, the Cleveland team has a player that is already widely regarded as one of the best players in the sport at the moment.
Although we will most likely not be at any playoff games in person, we will be sure to watch the games together in our home. However, I am wondering what thoughts my readers have about what price they would be willing to pay for a seat at a championship game, a set of games that may well turn out to be, for those who live in Cleveland, Ohio, “once in a lifetime.” And, how would your age factor into determining this “reservation price?”
With economists everywhere, I mourn the loss of Nobel Prize winner John Nash this past week.
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