how would an increase in sport players wages shift the supply curve for sporting event tickets and what would be the subsequent effect on equilibirum price/quantity of tickets
2 answers
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See my earlier post to your question. The answer largely depends on whether players wages are treated as fixed costs or variable costs. The other important consideration is whether you think the number of seats available is fixed or not.
I would argue that, for a professional sporting event, the player's salaries are, effectively, a fixed cost. Further, the, number of seats in the stadium is some fixed number. Ergo, for both reasons, independently or combined, no change in the supply curve for tickets as a result raising player salaries.
Now then, raising salaries might attract better players, which increases the demand for the tickets. But, this is a demand-side response.
Feel free to disagree.
I would argue that, for a professional sporting event, the player's salaries are, effectively, a fixed cost. Further, the, number of seats in the stadium is some fixed number. Ergo, for both reasons, independently or combined, no change in the supply curve for tickets as a result raising player salaries.
Now then, raising salaries might attract better players, which increases the demand for the tickets. But, this is a demand-side response.
Feel free to disagree.
3 answers