Major League Baseball teams recently released information regarding 2002 single game ticket prices. What were significant determinants of the teams ticket prices? How well the team performed last year? The teams state population? Team payroll? Has revenue sharing affected prices? Using available information regarding MLB stadiums, these issues are more closely analyzed.
Economic theory states that ticket prices are determined by the interaction of market supply and demand. In order to examine the issue of ticket prices, key factors influencing consumer demand and producer supply must be determined. To identify significant factors, the statistical method of ordinary least squares was performed. This analysis serves to ascertain the factors that influence demand and supply, and therefore the factors determining the price of tickets.
Two ticket models were created, one concerning the cheapest single game seat, and one concerning the most expensive single game ticket. Findings support economic theory. The models had high degrees of correlation, indicating the ticket prices were, in fact, determined through the market process. Therefore, MLB ticket prices are indeed the result of the interaction of demand and supply.
Brent Henry, ’02 Aurora, CO
Majors: Economics and Business and Sports Management
Sponsor: Todd Knoop