Pricing Decisions in a Vertically Integrated Live Entertainment Industry

Live Nation has recently been criticized for profiting from resales of tickets. This thesis examines in what way the pricing decision of a concert promoter differs when it acquires platforms that facilitate ticket scalpers. I find that a vertically integrated promoter has an incentive to set lower prices in the primary market for high demand events when artists obtain a sufficiently large share of the profits from the primary ticket sales and the promoter has a strong position in the secondary market. Vertical integration does have a welfare diminishing effect though, because, in contrast to an unintegrated market, it does not lead to an optimal allocation of the tickets.