Last month, researchers at the Vanderbilt Policy Accelerator published a white paper titled How to Save Audiences $11 Billion on Live Events. The Accelerator proposes prohibiting ticket resale above face value and capping online ticket platform fees at 10%, arguing those policies would reduce consumer costs by $11 billion annually.
That is an attention-grabbing claim. But after reviewing the paper and the economic research surrounding ticket resale, we do not believe the Accelerator has made the economic case for either its $11 billion savings claim or the sweeping restrictions it proposes.
The problem with the Accelerator’s analysis is not that it identifies costs in the secondary market. Some of those costs are real. The problem is that it counts those costs while largely ignoring the economic functions and consumer benefits on the other side of the ledger. At best, that makes the analysis incomplete. At worst, it calls into question the conclusions built on it.
Three issues deserve a closer look.
1. The Accelerator says professional resale provides little economic value. Its own evidence and the market say otherwise.
The Accelerator argues that professional resellers largely insert themselves between the original seller and the consumer without providing meaningful economic value.
But one of the principal economic studies discussed in its own paper reaches a considerably more complicated conclusion.
Economists Phillip Leslie and Alan Sorensen studied actual primary and secondary ticket transactions and found that resale improves “allocative efficiency” by moving tickets from people who value them less to people who value them more. Their analysis found that resale increased aggregate surplus by approximately 4%, even after accounting for transaction costs and other inefficiencies.
Put more simply: the secondary market performs a real economic function by helping tickets get to people who want to use them.
That distinction matters when measuring economic harm. A resale markup is not automatically an economic welfare loss. Some of that money is a transfer between a willing buyer and seller, while the transaction itself may create value through reallocation, liquidity and access. The proper economic comparison is not simply the resale price against the original face value. It is the actual resale transaction against what would realistically have happened to that ticket and consumer without a secondary market.
That matters because the Accelerator places significant emphasis on the original on sales and queues as a preferred way to allocate scarce tickets.
But queues have an economic cost too: the opportunity cost of time.
Not everyone can sit online at a prescribed hour waiting for an on sale. Some people are working. Some are taking care of their families. Others simply did not know about the event when tickets first went on sale.
And for many consumers, the on sale itself is not an attractive shopping experience. They enter at a specific time, wait for access and then often make a high-pressure purchasing decision based on whatever inventory is presented to them, sometimes against a countdown clock.
The secondary market does not prevent anyone from participating in that original on sale. It gives consumers another option afterward: shop when they want, compare available seats and prices, and decide when and where to buy.
A queue does not eliminate scarcity. It changes how scarcity is allocated. Instead of competing partly on price, consumers compete with their time, schedule flexibility and ability to be present at exactly the right moment.
And what is the answer for the fan who never knew about the original on sale?
Professional ticket sellers also perform economic functions the Accelerator largely discounts. They deploy capital and assume inventory risk before final demand is known. They absorb losses when demand falls. They assume risk in acquiring inventory. They provide liquidity to fans who need to sell. They aggregate inventory, provide expertise, fulfillment and customer service, stand behind transactions, and compete for customers on price.
They also spend substantial resources on marketing events and tickets to consumers. That marketing expands awareness beyond the audience reached during the original on sale. Hundreds of independent businesses have an economic incentive to find consumers interested in attending an event. In that sense, professional sellers do not merely redistribute existing demand; they can help create additional demand by connecting events with consumers who otherwise may never have known tickets were available.
And there is another side of the price equation that deserves to be counted.
Professional sellers do not simply buy tickets that increase in value. They also buy tickets that decline in value, absorb those losses and sell those tickets to consumers below their original price. Current industry transaction data show that roughly 40% of tickets sold on the secondary market sell at or below face value.
That is not a marginal feature of the market. It represents a substantial portion of transactions in which consumers have access to tickets at prices equal to or lower than the original price.
If the Accelerator wants to count the economic cost when a ticket sells above face value, a complete analysis should also account for the consumer benefit when a ticket sells below it.
You cannot count only one side of the ledger.
Some will argue those tickets should never have been purchased for resale in the first place. But that assumes demand is static and that every ticket purchased by a professional seller displaced a fan who wanted that same ticket at the original on sale.
Real markets do not work that neatly. Demand changes. Consumers enter and leave the market. Events overperform and underperform. Professional sellers assume that inventory risk, and when demand falls, they absorb the loss while consumers benefit from the lower price.
2. The Accelerator’s pricing theory changes depending on who receives the money.
The Accelerator recognizes that competition matters. Its ticket paper discusses the lack of consumer choice in primary ticketing, where consumers generally cannot choose which primary platform sells tickets for a particular event.
In a subsequent analysis of Live Nation’s position in the live-event business, Accelerator researchers went further, arguing that concentration can result in higher prices and fewer choices and advocating greater competition.
That is a familiar economic principle: competition gives consumers choices and forces sellers to compete on price, inventory and service.
But the Accelerator applies a very different principle to resale.
Primary ticket prices are not necessarily fixed prices anymore. Artists and primary sellers can use dynamic pricing and premium products such as Platinum tickets to capture more of what consumers are willing to pay when demand is high. The Accelerator does not propose limiting those prices.
Nor are we suggesting government should.
Supporters of resale caps may respond that higher primary prices are different because the additional revenue goes to the artist or another original rights holder.
That may be an argument about who deserves the economic upside from an event. But it is not an argument about consumer affordability. To the consumer paying $500 for a ticket, the price is still $500.
If the policy objective is lowering what consumers pay, an economic analysis should explain why demand-based pricing is acceptable when the original seller captures the upside but becomes consumer harm when that same demand establishes the price of a subsequent lawful transaction.
An original seller remains free to respond to demand and charge $200, $500 or $1,000 for a ticket. Yet once a consumer lawfully purchases that ticket, the Accelerator would have government restrict what that owner can receive for it.
We are not arguing that government should restrict what artists charge. Quite the opposite.
The inconsistency illustrates the problem with selectively regulating secondary prices.
More importantly, eliminating professional resale does not create another ticket or eliminate scarcity. It removes a group of sellers competing for consumers on price, inventory and service and shifts more control over the distribution and economics of scarce tickets toward the original market.
That is particularly difficult to square with the Accelerator’s own concerns about concentration elsewhere in the ticket industry.
3. The proposed cure can produce the opposite economic result.
There is also peer-reviewed research examining what happens when resale prices are restricted.
A recent peer-reviewed study published in Marketing Science modeled price caps in ticket resale markets and identified an important potential consequence. A stringent cap can drive higher-priced sellers out of the market, reducing seller-side competition. Under those conditions, the researchers found that the average transaction price may be higher than in a market with no price restriction.
That finding should be central to this discussion.
A policy designed to lower ticket prices can reduce competition enough to produce higher average prices.
The Accelerator explicitly proposes preserving face-value-or-below peer-to-peer resale while “eliminating the broker business model.” The question is not whether some tickets would still be resold. Of course they would.
The economic question is what happens when professional inventory and competing sellers leave the market.
Fewer sellers can mean less readily available inventory, less competition for the customer’s business and, according to peer-reviewed economic research, potentially higher average transaction prices.
A price cap can also change where transactions occur. If inventory migrates away from established platforms, some consumers may lose guarantees, payment protections, delivery tracking and other forms of accountability. That creates a foreseeable risk of additional consumer losses through fraud, failed delivery and transactions in less accountable channels. Those losses may be difficult to quantify in advance, but an economic analysis of the policy should at least account for the possibility rather than assume the transactions simply disappear.
There is a similar problem with using illegal bots as justification for broad restrictions on legitimate resale.
NATP opposes the use of illegal bots to acquire tickets. But federal law already prohibits using bots to circumvent ticket-purchase limits. When tickets are acquired illegally, enforce the law aggressively.
Illegal acquisition and lawful resale are two different questions. Misconduct by some participants is not an economic argument for eliminating an otherwise lawful competitive market.
Nor is a resale price cap the only conceivable policy response to concerns about authenticity, transfer or who participates economically in a subsequent transaction. Policymakers can consider technology that protects ticket authenticity while preserving transferability, stronger enforcement against illegal acquisition, or even mechanisms through which original rights holders participate in subsequent transactions.
Those ideas can be debated on their merits. But they illustrate a larger point: eliminating market pricing in lawful resale is a particularly blunt response to problems that can be addressed more directly.
For an analysis presented as economics, these are not peripheral considerations. They are the economics.
About that $11 billion headline
Finally, there is the number that generated most of the attention around the Accelerator’s paper: $11 billion. It sounds like a measured result. It is not.
The Accelerator acknowledges limitations in the available data and describes the need to “patch together data from various sources” to construct portions of its estimate. Those sources span different markets and different time periods.
There is nothing inherently improper about economic modeling. Researchers routinely make estimates when complete data are unavailable.
But a modeled estimate is different from a measured result.
The $11 billion is not an observed amount consumers currently lose each year, nor is it $11 billion in demonstrated savings from a market operating under the Accelerator’s proposed rules. It is a projection based on multiple datasets and assumptions about what would happen if those rules were imposed.
And those assumptions matter.
The larger problem is that the estimate relies on a largely static counterfactual: remove the markup and reduce fees while assuming much of the rest of the market remains unchanged. But markets respond to regulation. Sellers, consumers, primary ticketing companies and platforms change their behavior.
Does the calculation account for the economic benefit consumers receive when tickets sell below face value?
Does it account for sellers leaving the market after a price cap?
Does it account for changes in available inventory, competition or where transactions occur?
Does it account for the opportunity cost imposed on consumers when access to tickets becomes more dependent on participating in an original on sale?
Does it account for the value created when competing sellers’ market events, aggregate inventory and connect additional consumers with available tickets?
Does it establish why 10% is the economically appropriate national fee ceiling, rather than simply assuming that everything collected above that level represents consumer savings?
And does it account for the possibility, identified in peer-reviewed research, that restricting resale prices can increase average transaction prices?
Those are not small details. They go directly to whether the policy would produce the consumer savings the headline promises.
The Accelerator raises legitimate questions about ticketing. We should be willing to have those conversations, including illegal bots, consumer protection, transparency and competition throughout the ticket industry.
But if the argument for dramatically restricting a functioning secondary market is an economic one, then the analysis should account for the full economics of that market, including both its costs and its benefits.
Consumers should have the opportunity to buy during the original on sale. They should also have a competitive secondary market when they cannot, do not, or simply choose not to.
Good policy should preserve those choices while targeting actual misconduct.
And before policymakers accept an $11 billion savings claim, they should ask a simpler question:
Will this policy make consumers better off?
The economic evidence suggests the answer is considerably less certain than the headline.
Zach Anderson
On behalf of the National Association of Ticketing Professionals
To learn about the benefits of the secondary ticket market, check out this piece on what NATP Members Do for Fans.