The World Junior Hockey Championship is taking place in Buffalo, and at least one reporter at the Buffalo News is left wanting for some economic understanding and journalistic integrity.
I realize staff reporter Gene Warner probably didn't come up with the headline "$40, $50, $60 — to park!?!," but the copy editor who did accurately interpreted Warner's bias throughout the piece. (Note to editor: The P in park should be capitalized.)
Warner doesn't simply report on some hockey fans' negative reactions to increased parking prices around HSBC arena; he flat-out calls this completely normal and predictable occurrence "price gouging."
Fans attending Tuesday afternoon's Finland-Switzerland hockey game could have bought two tickets and parked their vehicle for a total of $46.
The twist, though, is that the tickets could have been purchased on a secondary ticket market for $3 apiece — and the parking for $40.
Welcome to the World Junior Hockey Championship's version of Economics 101, a hockey tournament that features both bargains galore and some serious price gouging, in and around HSBC Arena.
Clearly, merchants offering parking and other goods- and services-based operations during this tournament have a clear understanding of Econ 101. Too bad Warner doesn't. In fact, he doesn't even seem to understand that these cheap ticket prices are likewise the result of their own market supply and demand. Perhaps the broker had an excess of tickets, or the game was of relatively little demand to fans (for example, it probably wasn't a U.S.-Canada contest).
Prices reflect the availability of scare resources. When they rise, people often accuse those setting the prices of "gouging," though rising prices simply indicate an increase in demand, a decrease in supply, or both. Prices also force consumers to economize.
It should be obvious that there are only so many parking lots and spaces immediately surrounding the hockey arena, thus constituting a high demand for a limited supply of spots during such a high-profile hockey tournament (and frigid weather, I might add). Therefore, parking lot operators know that people will be willing to pay to park close to the event, even if they might prefer more "normal" prices (Buffalo Sabres fans generally pay $10-15 to park for a regular season game, according to Warner).
But what many people may not understand is that this hike in parking prices is normal, if due to nothing but the fact that parking lot operators cannot force people to pay their asking price. Therefore, if people are willing to fork over the dough, that's a good indication that, as Bob Barker would say, the price is right. Consider this fan's comments:
"Forty dollars is a little pricey," [Mac Yule of Hillsburgh, Ont.] said. "Once you're across the border, you're going to the game. You're not going to turn away because of $40 parking. But they know that, so it's gouging."
Sorry, no it's not. It just means the merchant knows your demand for parking is a lot higher than if you were planning to spend the day at the Galleria Mall.
Not only do these current parking prices reflect a high demand for limited parking spaces, they also allow for more hockey fans to park close to the arena instead of walking long distances. Because rising prices force consumers to economize, more people will carpool instead of driving to the arena separately to meet their friends (Forty bucks divided by four people in a car is pretty close to that $10-15 amount Warner referenced earlier, isn't it?). Higher prices also help to guarantee that those who truly must find a parking place -- say, the elderly or disabled -- will be able to do so, as fans who would rather walk a little farther and save their money for food and beverages will voluntarily leave a spot for someone who has a higher demand for it.
Rather than representing the "evils" of capitalism, as many people no doubt mischaracterize anything with a price tag, fluctuating prices are one of the purest indicators and guarantors of peaceful, voluntary human interaction.
Only the state can truly gouge us -- its litany of taxes, fines, and other compliance fees comes to mind. We're not doing ourselves any favors by shitting on the people who are actually on our side.
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