JustTheTip":2inci3xs said:
Not only that, but the owners aren't going to make less because the players start taking a larger chunk. They will simply increase prices to compensate, passing on the player's pay raise (plus some) to the fans.
No, they won't. That's not how economics works.
Whether you are selling an NFL ticket or a carrot, the price is set by what the *buyer* is willing to pay for it. The seller may choose to sell for less to attract new clients, to undercut a competitor, or other reasons, but he can't sell for more without losing clientele.
Some companies are happy to sell for more money to a fewer number of clients, to maintain exclusivity of a product, or because that's the sweet spot in their costs vs units sold, but in order to do so they need to convince the buyers that the product is worth more via advertising. See: Fashion, exotic cars. etc.
However, NFL teams don't operate that way because if they don't move the units (tickets) they get blacked out and lose TV revenue. They have to sell tickets, so they have to make them affordable, but to maximise profits they sell them for as much as they can.
Buyers determine what a product sells for. Costs determine how much profit is made, and whether or not it is feasible to continue selling the product, but have little to do with price.
Yes, there are some stores that work on a markup basis. They take the cost, double it, and that's what they sell it for. However, they are mainly retail businesses that don't do any market research to see what they can get away with, and sell products from companies that *have* done that research and know what the public will pay for their product, post-markup.