Economists Needed in the Music Business!
For the first time, Austin City Limits, one of the two biggest music festivals in town, is running on two weekends instead of just one. Unfortunately, the price for a pass for the second weekend on Craigslist is now down to half the festival sponsor’s original asking price. Why?
1. The asking price for the second weekend was the same as for the first—not smart when you’re doubling the number of offerings; and the headliners are identical on the two weekends. The amount supplied is double in quantity, but no different in quality or even in variety; double supply, no change in demand.
2. Demand is almost certainly lower on the second weekend, since that is the weekend of the UT-Oklahoma game in Dallas.
It was probably a bad business decision to price the second weekend the same as the first.