Econ 101, with a musical twist.

We might be in an economic recession of monumental precendent (check out Paul Krugman's NY Times article - it's been on the "Most Popular" list for the past 5 days), but some high school kids are still willing to pay exorbitant amounts of money for a concert ticket to hear their favorite electronica/pop band.

It's all about supply and demand.

Case in point: Tickets for the Owl City concert in Atlanta were sold out about a week ago. In other words, supply was limited. And, as common sense (and Graph 1 below) might tell you, when the quantity of a product goes down, the price goes up because people are willing to pay more to get what they want. In fact, it wasn't long before tickets started selling on $30 or $40 on Craigslist - even though the original cost of the ticket was only $12. In financial terms, that's called a price mark-up (though, in this case, it didn't really cost the seller anything to "produce" the ticket, so a profit was made without expending any services).

Graph 1: Relationship Between Supply & Price

By 8 pm on the night of the concert, demand had shifted to an all-time high (see Graph 2 below). Desperate, antsy teenagers were huddled in small groups outside the entrance to the venue, willing to pay upwards of $50 for a ticket. One kid actually offered my friend $70 (that's about 580% more than the original price of the ticket!), though my friend was nice enough to sell it to him for $40 - still a solid profit of $28. I'll omit the pseudo-verboten details, but a few of us (myself included) ended up selling our own tickets at a similarly substantial profit and we managed to make it into the concert.

Graph 2: An Upward Shift in Demand

Owl City's overall performance - and, in particular, Adam Young's unfiltered/unedited vocal performance - wasn't nearly as amazing as the ritzy recordings. By purely musical standards and substance, then, my first live U.S. concert wasn't quite what I'd hoped it would be. But the night itself was made memorable by virtue of my friends - the financially-loaded, ticket-seeking "friends" I temporarily made on the corner, as well as the more permanent, financially-savvy friends that I went to the concert with in the first place.

I'm beginning to see how my (currently limited) knowledge of financial accounting and health economics might actually be beneficial when combined with some street smarts; and with friends like these, well, who needs enemies?*

*"The Bird and The Worm", Owl City.