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Unformatted text preview: would bring the late price down to v . This is a possibility, but only if enough diehard fans are willing to change their plans. There are at least two reasons why this may not happen. First, diehard fans have to make an early personal investment in travel and work plans to join the event, which implies that the value that diehard fans place on the event is more than just what they paid for their ticket in the early market. If their personal investment is high enough, then they will not be willing to resell in the late market. Second, the behavioral economics literature has shown that people typically report higher valuations on objects after they become owners of the objects, a phenomenon known as the endowment effect (Kahneman, Knetsch and Thaler, 1991), and Krueger (2001) has found some evidence suggesting that this hypothesis applies to tickets....
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- Spring '09