The Price of Success in Sports

Mizzou heads into the upcoming football season with national championship aspirations. They return 10 of 11 starters on defense, a Heisman finalist at QB, a prolific tight end, and an All-American at wide receiver. A consensus top-10 team doesn’t come cheap for fans, who have a higher demand for all things Tiger…

Not just to Babcock, MU’s senior associate athletic director in charge of external operations. Changes to the way reserved parking spaces have been allocated for the upcoming football season – the very thing Babcock was discussing – have led hundreds of Tiger Scholarship Fund donors to contact the athletic department this week looking for an explanation.

What has so many people riled up is that, for the first time, Missouri is charging donors a $100 fee on top of their donation and season-ticket costs for a parking space in any of its reserved lots. In the past, those spaces had always been complimentary.

Damned if Mizzou does. Damned if Mizzou doesn’t. Babcock could have said something like, “We’ve got unprecedented demand for season tickets, parking spaces, single-game tickets, etc., and we’ve got to divvy up a relatively low amount of resources.

We could have used other ways to allocate valuable resources (first-come-first-serve for parking, for example, which means some people who would come from, say, St. Louis might not be able to find a parking space after they’ve made the 2-hour excursion to Columbia).

Or we could have given them to our friends and political contacts. That way of allocating resources will also upset some people. We thought that the most efficient way was to charge higher prices so that those with the highest willingness to pay to get the first crack through us.

“We realize that we’ll never be able to make everyone happy. But at least the higher prices allow us to generate more revenue which we can use to invest in our athletic programs.”

Cross-posted at Market Power.

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Author: Phil Miller

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