Market Power

Legalized Scalping in Missouri

The state of Minnesota recently legalized the practice of scalping tickets.  The Missouri Legislature is considering lifting a similar scalping ban in that state as part of an overall "economic development" bill.  The bill is supported by all of Missouri's major sports teams.

Skip Sauer at The Sports Economist writes:

The internet obviously made it much easier for buyers and sellers to exchange tickets to sporting events, and I'm all for loosening the restrictions on secondary markets. It should surprise no one that former opponents of scalping (the sports franchises) are now in favor, given that they can get a piece of the action. As has been pointed out here before, resale demand increases the value of the initial sale as well. Thus the franchise can win on both ends, particularly by earning a return from offering a safe and secure exchange mechanism. The only losers are the ticket touts operating under the corner lamp post. Long live ticket scalping!

Historically, teams have had to deal with some of the consequences of ticket scalping, such as dealing with counterfeit tickets, losing control over who can obtain tickets to games, and having to deal with pushy scalpers outside of stadiums and arenas (see here).  But until the internet made it possible for teams to get in on the action, they didn't receive any of the benefits.  Now they can.  So it's understandable why they supported scalping bans historically and why they have changed their tune recently.

OU Booster Denied in Attempt to Raise Funds for Murdered Recruit's Mother

The NCAA rule book is so thick with rules against this, that, and whatnot that it seems almost impossible not to break some rule.  But this one is startling (HT to Tom Kirkendall):

Just hours after Oklahoma football recruit Herman Mitchell was shot to death Friday in Houston, Adam Fineberg started raising money for Mitchell's family.

But after raising $4,500, enough to cover almost half the cost of Mitchell's funeral, Fineberg stopped. An OU compliance officer told him his actions would constitute an NCAA rules violation against the Sooners.

Now, Mitchell's mother likely will never receive that money.

That money is considered illegal financial assistance under NCAA rules because Mitchell's brother is a sophomore fullback at Westfield High School in Spring, Texas, and because Fineberg is an OU fan who attends Sooner football games and solicited donations through an OU fan Web site.

OU's compliance office asked Fineberg to stop taking donations and asked the NCAA for an interpretation on the rules.  Considering that OU has recently been in deep trouble with the NCAA regarding the Rhett Bomar situation, it's hard to fault OU in this case.  But I have trouble seeing how the NCAA can shut this operation down.  How can this give OU a competitive advantage?

MP: A Top 100 Blog

Market Power is listed as a top-100 economics blog by CurrencyTrading.net.  It is listed as a "General Blog" among the heavy hitters in the econoblogosphere such as Marginal Revolution, Division of Labour, Freakonomics, and EconLog.  According to the short description about MP:

Select writings from an academic economist tries to portray the power of markets.

The emphasis is mine and my tongue is firmly planted in my cheek.  We here at the PowerHouse always try.  We don't always succeed, but you can rest assured that we always give it that old college try.

Coaches vs. Governors: Coaches in a Landslide!

The Kansas City Star has compiled a list of each state's governor's salary and the highest paid head coaches in that state.  The coaches win 49-1 with Alaska being the only state where the coach is not paid more than the governor.

Update:  make that $2.91 million for UT coach Mack Brown.

Improving Health Care

The Door links to an article about store-based health care clinics, an alternative to visiting the doctor's office for routine issues.  The whole thing is worth a read, but the following caught my eye:

In June, the American Medical Association urged state and federal agencies to look into whether pharmacy chain-owned clinics urge patients to get their prescriptions filled on site. That followed buyouts of miniclinics by two big-name pharmacy operators: Walgreen bought Conshohocken, Pa.-based Take Care Health Systems in June, and CVS acquired Minneapolis-based MinuteClinic last year.

Suppose you go to Best Buy and you talk to an associate about a new home stereo system.  What do you expect him to do - send you to Circuit City to buy the same thing he already has on site? 

Moreover, my sense is that most patients will choose to go to a clinic in a particular store because they think that is be the best place to get a check-up and any medicine they may need.  What's wrong with a patient wanting this kind of bundling and being able to get it?

Ethanol Plants to get Backpay Subsidies

From the Minneapolis Star-Tribune:

When the state cuts funds for schools, libraries, parks and other programs, the money often is gone forever.

But in the case of ethanol subsidies, money taken away years ago now is being restored with big checks that will get a lot bigger.

The state of Minnesota this month will send $1.8 million in subsidies to 13 ethanol plants for millions of gallons of fuel made as long as four years ago. Another $53 million is slated to be sent to those producers over the next six years.

The money is coming so long after the fact that one check will go to the creditors of a St. Paul ethanol plant that went out of business in 2004.

The article also sums up the history of ethanol subsidies and mandates in the state of Minnesota.

You can argue that the payments shouldn't be made, given the natural disasters to hit the state and the solid profit margins being realized by ethanol plants (29 percent according to the article).  You can also argue that the government is sticking to a promise.  But you can also plausibly argue that the subsidies should never have been promised in the first place because ethanol is essentially a private good and the government has no business subsidizing risk-taking.  After all, if an infant industry looks to be a good investment for society, why wouldn't there be sufficient private capital flowing into the industry?

Congratulations, Carl Edwards

Carl Edwards is having a nice season, coming off of a bit of a sophomore slump.  He won last night's Nextel Cup race in Bristol, TN, his second win this season, and now stands at 5th in points.

Addendum: the win clinches a spot in the chase for the Nextel Cup for Carl.

Blogs and Newspapers

Online news sources and blogs have taken a toll on newspapers.  Those that can figure out what to do will weather the storm.  Graham Watson, the St. Louis Post-Dispatch beat writer for the Missouri Tigers hints at changes that will be coming at the P-D in the future as that paper changes.  An excerpt:

But there might be a time, and I’m not saying it’s this year, where you’ll see more notes than stories and where you might see a variation on our game previews. Instead of stories, we might do preview boxes that give more direct and concise information in a more bullet-point format. I can tell you that we’re probably not going to run the starting lineups like we usually do.

...The one thing that will not change in all this will be the massive amount of stuff I do on the blog. All of the daily items you came to expect last season will return this year, and I’m going to add live updates after each quarter during the game and a blog on Sunday where we go back through the advantage and see how I did. I was pretty spot-on last season, so I’ll be braggin’ on myself whenever possible.

Congratulations, Dr. Brian May

You may call him Dr. Brian May:

Queen guitarist Brian May was on Thursday awarded a doctorate, more than 30 years after he first began studying a highly specialised area of astronomy.

May first started his thesis - titled, "Radial Velocities in the Zodiacal Dust Cloud" - at Imperial College London in 1974, but abandoned it when Queen's prospects began to brighten.

He finally dusted off his notes last year and handed in his 48 000-word doctoral thesis about three weeks ago to Imperial's head of astrophysics Professor Paul Nandra.

"I'm feeling rather joyful. I cannot tell you how much of a weight off the mind it is," May said after his assessors approved of his thesis and he passed an oral exam.

Here's Dr. May in his own words on his soapbox:

Yes. It's done, and after about 37 years, I am finally a doctor. The oral examination of my thesis, and of me, lasted about 3 hours, and then I retired with Prof Rowan-Robinson, for a few moments, for my two examiners to confer. After only a couple of minutes they called me back into the room and offered their hands in congratulations. Yes, my category was number 2. I understand pretty much nobody gets a 1st category - which is "This is perfect - here's your PhD."

             

Mine is "We like it. Make these adjustments, and it's yours."

Been there.  Done that.  I wonder what was more nerve-wracking:  playing in front of thousands of fans or defending the dissertation.  In any case:  congratulations Dr. May!

Getting Back at Michael Vick

I love the irony:

Take some trading cards picturing a disgraced NFL superstar. Add some dog slobber and teethmarks. What do you get?

The most valuable Michael Vick cards -- by far -- on eBay, that's what.