Quote:
Originally Posted by longsuffering
I think this analogy nails it. When CaliFlamesFan later tried to address incremental price increases or opportunity costs, he inadvertently and unnecessarily clouded the issue.
When a person flies, they pay the airport improvement tax. It is collected by the airlines but is ultimately paid to the airport authority. No one, including the airlines, consider it to be a contribution funded by the airlines. It is a legally mandated charge, collected by the airlines which the airlines understand will pay for airport upgrades, etc.
Whether the consumer cares about the the amount of the tax or only the bottom line cost of the ticket, the airport improvement tax is most definitely a part of that cost.
The ticket tax, which is not a exclusively a Flames ticket tax, is exactly the same thing. The users, including Flames ticket holders, Hitmen ticket holders, concert ticket holders, etc., pay a provincially mandated tax to pay for the construction of the new facility. How much or how little it impacts how the Flames price their tickets is immaterial. It's only purpose is to provide funding for the new arena.
This is the same scenario as the airport improvement tax.
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This is correct. Which is why, yesterday, when King was speaking on this topic - I stated that he was living in his own distorted reality. Trying to use beginner-Econ theory in this manner is very stupid.
What King is describing is a perfect economy, where items are perfectly priced...not a dollar more/not a dollar less. In reality, this doesn't exist. No system is perfect.
- Adding ticket tax on top / raising ticket prices creates two different reactions from buyers. A buyer is more likely to accept a ticket tax than to accept a ticket price increase.