Market Power

Maybe They'll Look the Other Way

Has someone declared war on one of the few reasons to come watch MU football on a regular basis?

Beer kegs and bulk quantities of alcohol will no longer be allowed on university property, the MU Police Department announced yesterday.

"We’re not trying to dampen people’s spirits," Capt. Brian Weimer said. "We just want everyone to have a safe experience."

"Not trying to dampen people's spirits."  Har.  You're so daft.  But I guess my friend Brian's jello shots are out of the question.

Weimer said officers would define bulk quantities of alcohol on sight.

What constitutes bulk alcohol?  Two bottles of Everclear or two cases of beer?  How can they tell the difference between a case of barleywine with 10% alcohol in each bottle and a case of basic American beer with half the alcohol or less?  And what's to keep an officer, having a bad day, from raiding a party when someone else lucky enough to not come across said officer, all else equal, is left alone. 

Weimer said football Saturdays in the past have led to charges of driving while intoxicated, minor in possession and numerous other alcohol violations. He hopes this measure will help curb those incidents.

..."If anything, you’re going to have students drinking out of flasks and drinking hard alcohol," he said. "They’re always going to find a way around it. Football games are so big, you’re not going to be able to monitor everybody."

Drinking out of flasks?  Drinking hard alcohol?  Heh.  That's never happened at Faurot Field before.  They must be trying to improve the overall game-day experience.  Either that or they are trying to increase the demand for this.

The Actual Cost of Adding the 12th Game

Recently I wrote this post over at The Sports Economist on what adding a 12th game to the NCAA Division 1 football schedule has done to the demand for games against non-conference, well, weaklings.  The effect has, apparently, been to raise the fees the weaklings can get for getting their arses kicked for 30 minutes (the games should be over by halftime for all purposes, non?).  There's been another effect, this one affecting a conference in hurricane-prone areas of the US:

Florida State, Miami and the Atlantic Coast Conference have had tentative conversations this week about backup plans should Tropical Storm Ernesto damage the Orange Bowl.

But the real contingency planning occurred this summer, when the league for the first time considered the worst-case scenario of a game wiped out entirely by weather. The concern had been on FSU Athletic Director Dave Hart's mind for a while, but the damage caused last year by Katrina and Wilma -- both to infrastructure and football schedules -- prompted the Atlantic Coast Conference this year to adopt a firm rescheduling policy and to buy event-cancellation insurance.

The insurance policy is worth up to $8 million a year and would help schools recoup lost gate revenue, even from non-conference games.

"I know that sounds like a lot of money,'' Hart said. "But one major hurricane through the Carolinas or through our state -- or, heaven forbid, those two events in the same year -- could impact eight schools very easily. Gate receipts alone would hit that [$8 million] ceiling.''

Florida State goes further:

So FSU has purchased its own policy above and beyond the ACC's. Hart did not have exact figures. But the investment, he said, is necessary, particularly now that college football's 12-game schedule in 13 weeks would make rescheduling most games almost impossible. "I'm afraid it's imminent and not a case of 'if,' '' Hart said.

One question that I have is this:  would the conference officials made the same decision if Katrina had NOT gone through New Orleans and did so much damage to places like the Superdome? 

Dear Econo-Abby

From a recent Dear Abby column:

I am a registered nurse who graduated from nursing school a year ago and hates her job. I am getting ready to change careers. It will cost me money, but I feel the payoff in time and peace of mind is worth it.

What do I say to people who are going to criticize me for it? Yes, I know it seems crazy to have spent four years getting a degree and not use it, but I really don't like nursing. The problem is mainly the other nurses and the environment, not my patients.

Aha... what pitfall do we see "Susan in St. Louis" contemplating that will, if taken into account, lead to a subotimal outcome?  Anyone?  Anyone?  Bueller?  Bueller?  That's right:  failure to ignore a sunk cost.  To her credit, Dear Abby, apparently thinking like an economist, does not suggest she consider that sunk cost of her nursing education.

Angels Fight the Devil: One Team's Battle Against Ticket Scalpers

From the Los Angeles Times comes an article about Los Angeles Angels officials' attempt to control the scalping of tickets sold in season ticket packages:

In an effort to sell more tickets directly to the fans who will use them, the Angels are cracking down on season-ticket accounts.

With ticket demand at record levels, the Angels are taking aim at customers who buy season tickets then recoup their expense by selling the majority of those tickets at a profit. So, effective next season, customers cannot resell tickets to more than 20 games and must limit the resale price to three times face value.

What could the Angels officials be responding to?  Why would they care who comes to their games as long as there are fannies in the seats (and concessions and souvenirs being bought)?

"We have a few accounts who are treating their purchases as an investment, a money-maker, if you will," Alvarado said. "If they're putting the burden on me to ensure they get it for free, I've got a problem with that."

The Angels also have barred customers from resale via any means other than the ticket exchange feature on the team website, where the team collects a fee for each transaction.

It seems that "the burden" Mr. Alvarod refers to is, at least in part, the extra competition that comes from these ticket scalpers.  The existence of the scalpers, especially those who "treat their purchases as an investment - presumably "repeat offenders," if you will - would conceivably drive down the fee.

Then again, these season ticket packages are the property of the Angels, until sold, and they can pick and choose who get them.

One More Twister Picture

Liz Olmanson snapped this picture of the Aug 24th tornado that roared through these hear parts of southern Minnesota from her front yard and was kind enough to share this with me for the blog.  The view is looking west over the Minnesota River valley.  St. Peter is roughly two-three miles north (to the right) of the tornado.

Close Call

The semester starts tomorrow so I've spent the past couple of days preparing the administrative things that are due this week... thus the light blogging.

Doc wants pictures of the storm and the aftermath.  Here's what I saw from the highest level of my house (THE place to be in a tornado warning, eh?).

Wall clouds, baby.  Below is a picture taken by a local fellow named Andrew Thom and posted at WCCO's website  here around the time I took the video from which I captured the screenshot.

I'm not sure, but it looks like I saw the wall clouds that spawned the tornadoes that Mr. Thom photographed.  Here's another view from my house.

Here's a picture I took looking north about 4 miles or so south of Cleveland, Mn.

I'm not sure if that's the tornado or not, but I took the picture at about the time Cleveland got hit.

Here's one of the odder things I saw.  You know the joke: "tornado hits cemetery.  Bodies everywhere".  The tornado travelled right over the graveyard, about 1.5 miles south and east of Cleveland, and toppled alomst every headstone.


The towers you see standing below are portable cell phone towers.  The original tower (towers?) was levelled.

The smoke you see in the background is a common sight in that area as people burn what's left of their property.  Quite sad, actually.

Update:  A friend who lives about 1/3rd of a mile from that fallen tower called and told me that his place was not touched, save for a folding chair that got knocked over.  Just behind me where I took this picture lies a field of corn.  On either side of the field are two very nice homes, about 2 tenths of a mile apart or so.  From what I could see from the road, neither house was touched.  But the corn between them was flattened.

Minnesota's Tornado Alley - Part Deux

In April of 2005, I wrote this post on Minnesota's tornado "alley", a circle with a 20-mile radius centered around Nicollet, Mn. where, on average, one tornado per year has touched down.  Most of last evening's action was within that circle. 

Scary Thursday

We've gotten off easily, weatherwise, up here in Southern Minnesota.  Tonight's different.  Reports are that large tornadoes have already touched down in the area and have caused some extensive damage.  I saw many limbs down in Kasota, but the authorities have blocked off Highway 22 between Kasota and St. Peter due to trees covering the road.  St. Peter was hit hard 8 years ago by a large tornado.

Outside my house, the winds are strong out of the north.  Clouds around 500 feet up or so are moving south.  Those several hundred feet up are travelling north... wind shear.  Looks like the PowerKids and I will be spending the evening in the basement.  More later.

Update 1:  the third tornado warning of the evening has just been issued for Blue Earth County.  Sirens are blaring, but the storm is well to our south.  So that makes a tornado 5 miles north of my house and one, possibly, 15 miles to my south.

Law enforcement spotted a funnel cloud 5 miles to my east, around the town of Madison Lake.  The sirens blew on that one, but the National Weather Service wouldn't confirm it, so there wasn't an official warning let loose.  Apparently NWS folks give the official word and according to one radio announcer I heard (on 1420 AM... local radio) there were similar bits of confusion during the 1998 St. Peter tornado.

There's a football game going on between Minnesota State and Truman State (Missouri) at my college's campus.  They've postponed play for the time being.  More later.

Update 2:  The announcer on local radio who mentioned that there was confusion during the 1998 tornado said that the person who blew the sirens back then, before she got the official word from the NWS to do so, lost her house in a tornado tonight.  File that one under "Ironic."

Update 3:  Here's the local paper's take on things, along with several pictures.  An older man from Kasota, about 5 miles from my house (and just across the river and a mile south from St. Peter), was killed in the storm.  The PowerWife told me there was a trauma from St. Peter coming into her hospital.  I wonder if this was the fellow.  Another fellow from the small town of Nicollet, about 7 miles west of Mankato, had a second house destroyed by a tornado.  He lost one in the 1998 St. Peter tornado. 

The residents of the PowerHouse, and said house, made out fine:  it didn't even rain at our house, oddly enough, although we had an impressive light show from the storms to our east and south.

This Year Depends on Last Year

Fan expectations of quality is one of the driving forces of demand in sports. One of the ways that fans of a team form their expectations about the current year's squad is by thinking about the quality of last year's team.  When a team performs well in one year, we see an upward tick in the demand for that team's contests (assuming there are no fire sales of last year's players).  Thus the higher ticket prices and ticket revenues we often see the year after a successful season.  The same goes for sponsorships.  To wit:

The Seattle Seahawks lost Super Bowl XL, but the team is cleaning up in the corporate sponsorship business in the wake of its trip to pro football's biggest game.

The Seahawks have added four new sponsors since the Super Bowl -- home improvement giant Lowe's, Regence BlueShield, American Family Insurance Co. and the Snoqualmie Tribe. Each new sponsorship is "a multiyear agreement with a mid-six-figures price tag," said Beth Wojick, the team's vice president of corporate partnerships.

A Sports Business Daily summary says that total sponsorship revenue is up 30% over last year for the Seahawks.

On Competition

In competitive markets, firms compete with one another to earn a customer's business.  The threat of competition provides discipline to all firms in the market to continue to work hard, even those who have "won" a customer's business.  If you don't keep providing the customer with value, there is always someone else out there who will.  The same principle is at work on the football practice field day in and day out:

Jamar Smith and Ziggy Hood agree on one thing: They both want to be Missouri’s starting nose tackle.

Currently, Hood is No. 1, and Smith, the starter a year ago, is making like the old Avis commercial. Trying harder.

“It’s going to be real intense,” Smith predicted heading into today’s 11 a.m. scrimmage, which is open to MU season-ticket holders. “In the summertime I worked with him and Jaron Baston (the backup to the other starting tackle, Lorenzo Williams), and everything was real competitive. It’s about me trying to get my spot back, him trying to stay up there.”

No argument from Hood.

“He’s doing everything he can to win back his position,” Hood concurred. “I’m doing everything in my power to keep that position.”