In the News
Dynamic Pricing: Ticketmaster pricing system criticised
A BBC news article on dynamic pricing should be hard for Economics students to ignore! In adopting a dynamic pricing model what are Ticketmaster trying to achieve, and to what extent is this desirable or efficient?
You could argue that it's simply Ticketmaster looking to capture more of the available consumer surplus, with no change in economic welfare, rather a transfer from consumers to producers. However, you might still debate about whether or not this is fair.
And whilst you might feel some sympathy for 'superfans' you might also think that seeing Harry Styles in concert on three separate occasions on the same tour is excessive.
tutor2u study note
Dynamic pricing is a pricing strategy in which businesses set flexible prices for products or services based on current market demands.
The aim of dynamic pricing is to allow a business that sells goods or services online and/or via mobile apps to adjust selling prices on the fly in response to changing market demand.
These "dynamic" pricing changes are done automatically by software agents that gather data and use algorithms to adjust pricing according to business rules.