Is There a Better Way to Sell NCAA Tickets?

Two UNC professors, Sridhar Balasubramanian and Barry L. Bayus, are co-authors on a paper by IU professor Preethika Sainam proposing a more efficient way of selling Final Four tickets - selling ticket options. Basically, the concept is you'd purchase an option to buy a ticket before the season begins, and if UNC makes it to the Final Four you could then purchase a ducat. I'm vague on how it would work in practice - the paper seems to imply options would be purchased base on the odds for and/or demand at a particular school, and that you would have the option to buy a ticket even if your school didn't make the Final Four. That seems to easily gameable; I, for one would buy my option through secondary alma mater UC Santa Barbara (odds of a Final Four - nil) and then buy my ticket when the Heels advance and plop down in my seat in Carolina Blue. As a general theory though, I'm not opposed to it. I'd throw down twenty or forty bucks for the chance to buy a reasonably priced ticket when the Heels make it to April, at least.

In discussing this, however, Felix Salmon brings up an interesting point:

The interesting thing is that reading between the lines of the paper, it seems that selling options is actually the second-best solution to these problems. The best solution would be to replace some (but not all) of the tickets with team-specific forwards, which expire worthless if that team doesn’t make the finals. That would allow the “team-oriented” fans to buy forwards rather than tickets which they might not want if their team fails to make it to the finals; it would allow “game-oriented” fans to buy tickets to the finals just like they can right now; it would mean that many more tickets could be sold in total (for the final match-up, you can sell 32 times as many forwards as there are seats), which would reduce the supply/demand imbalance which often drives scalping.

But isn't this roughly what the NCAA does now? Each attending school is given an allotment of tickets that go to students, staff, player families, and members of the athletic booster clubs. These members give money to the athletic department with full knowledge that the biggest donors will have the opportunity to buy tickets once the team wins the FInal Four; the probability that their team will do so surely has an effect on how much they give. Louisville supporters have in fact "bought' these team-oriented forwards over the course of the season, only to find them now worthless, as the Cardinals are sitting at home this weekend. Now, it may not be completely efficient, depending on the allotment to schools versus amount distributed to the general public by lottery, but it does seem awfully similar to the ideal situation being described.

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