Thursday 23 April 2009

Maximizing a non-monetary utility function: Bayreuth edition

In my Assorted Links post, I noted some features of ticketing for the Wagner festival at Bayreuth.

I've been thinking on it a bit more and it looks to me like the organizers at Bayreuth have figured out a nice way to massively subsidize effort in local Wagnerian societies. In short, the Wagner opera festival isn't there so much to generate a profit for the organizers as it is there to serve as a prize for folks willing to work hard in their local Wagnerian societies.

The stylized facts:
  1. Tickets are priced far below market price if you're willing to wait for nine years and assiduously fill in fruitless application forms for those nine years; only about 10% of tickets sell through this route.
  2. Some tickets sold through very expensive package tours (and surely Bayreuth charges those package tour places much higher prices for their tickets)
  3. Tickets distributed (at face value, but shorter/no wait) through local Wagnerian societies: some countries' societies (like NZ) have call on more tickets than they'd use; others are oversubscribed and must be allocated.
At a glance, it seems like a great mechanism for massively subsidizing regional Wagnerian societies: Bayreuth is a prize in a tournament game, not a market. The tournament game is putting in enough time and effort in your local Wagnerian society to ensure that you get a ticket sometime. The sum of time and effort put into those societies, by the winners and the losers, is greater than the value of the money that Bayreuth could redistribute for local promotion of Wagner if they instead priced the festival at market clearing.

I know nothing about this other than the three stylized facts above. Is my conclusion entirely insane?

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