World Cup Ticket Pricing, FIFA Governance and Globalization

On the Cato podcast this week, I spoke to the American Enterprise Institute’s Stan Veuger about the economics of the FIFA 2026 World Cup, which starts today. We discussed the furore over high ticket prices, whether hosting the tournament will boost the U.S. economy, football/soccer as a case study of globalization, and how Fifa exemplifies both the benefits and risks of global governance institutions.

I had a previous post explaining the logic behind Fifa’s use of soft dynamic pricing and an official resale market for pricing match tickets. It’s clear that most Europeans don’t like the prices that have resulted. But, as I explain in my column for The Times (UK - paywall) this week, the economics of ticket demand in rich, populous American metro areas with a limited number of games per city, coupled with Fifa’s desire for revenue, was always going to make this World Cup pricey.

One can wish that Fifa had sold tickets far below many people’s true willingness to pay, “for the good of the game” or “for inclusivity and fandom” etc, but Fifa was never going to leave vast sums of money on the table and let third party touts/scalpers take more of the surplus. And that is the clear trade-off here.

A lot of the criticisms of Fifa seem self-contradictory. Some talk as if they have mispriced the matches, and we’ll see tons of empty seats and lost net revenue. Others talk as if they should just not aim to profit maximize to begin with. Some people also think they’ve been withholding tickets and trickling them to third-party sites to avoid reducing their own headline prices.

But the prices on resale platforms don’t suggest yet that this is happening at scale. Most group stage matches are nearly sold out in the primary market and in the resale market prices have been going up recently, not down. Some prices might fall somewhat as we get towards the first matches and resellers cut their losses. But even, say, Cape Verde vs. Saudi Arabia, where prices have fallen, still has a minimum price for bad seats at around top-tier Premier League price levels (at $130).

Even if other prices do fall substantially from here, they aren’t going to be cheap by soccer standards. Outside of a few games between no-hopers, I suspect a lot of people hoping ticket prices will collapse amid the threat of empty seats or Fifa flooding the market with withheld inventory are likely to be disappointed.

Some other tidbits on prices:

• Government Hypocrisy: Ontario had passed a law stopping World Cup tickets in Toronto from being resold above face value, forcing FIFA to cap resale on its official marketplace. But the City of Toronto itself used its host-city privileges and taxpayer money to buy thousands of tickets, plus millions in hospitality inventory, with the explicit aim of reselling them as a revenue-generation strategy. In other words, private arbitrage is treated as exploitation, while public-sector arbitrage is fiscal responsibility.

• Prices Are Always Bad, OK? The NYT-owned sports publication The Athletic has been running a drumbeat of negative stories about the World Cup, especially around ticket prices being too high. But its latest story moans that prices aren’t high enough! The complaint is that “the states of Missouri, Georgia and Florida [decision] to waive taxes on World Cup ticket sales will mean at least $57.8 million in lost revenue for American taxpayers.” The food is terrible and the portions…so small!

• Yes, Prices Are Up A Lot on Qatar 2022: Playing around with some of the major countries, I calculate that it would be, on average, 5-10 times more expensive in crude dollar terms to follow your team right through the group stages to the final this year compared with the last World Cup. This is in part because there’s now one extra match in this year’s enlarged tournament. But it’s also because the ticket prices are just a lot higher. [See below for a ChatGPT-assisted summary for England prices….yes, I can dream].