Crucial Premise: Necessarily, the more someone is willing to pay for a good, the more welfare they get from consuming that good.
It seems to me that this premise as you’ve stated it is in fact true. The thing that is false is a stronger statement:
Strengthened Premise: Necessarily, if person A is willing to pay more for a good than person B, then person A gets more welfare from that good than person B.
For touting/scalping, you also need to think about the utility of people besides Pete and Rich—for example, the producers of the show and the scalper (who is trading his time for money). Then there are also more diffuse effects, where if tickets go for $1000 instead of $50, there will be more Book of Mormon plays in the future since it is more lucrative, and more people can watch it. The main benefit of markets is mainly through these sorts of effects.
Incidentally, I think the Crucial Premise as understood in the single person sense is also false. There are cases in which someone would be willing to pay more for something which is bad for them. e.g. drug addicts, tools to commit suicide with (in some cases) etc.
Thanks, yes my formulation was meant in the interpersonal way you suggest. Your formulation is more precise, so preferable and I will update in the main text.
I agree that the effects you mention are also important.
It seems to me that this premise as you’ve stated it is in fact true. The thing that is false is a stronger statement:
For touting/scalping, you also need to think about the utility of people besides Pete and Rich—for example, the producers of the show and the scalper (who is trading his time for money). Then there are also more diffuse effects, where if tickets go for $1000 instead of $50, there will be more Book of Mormon plays in the future since it is more lucrative, and more people can watch it. The main benefit of markets is mainly through these sorts of effects.
Incidentally, I think the Crucial Premise as understood in the single person sense is also false. There are cases in which someone would be willing to pay more for something which is bad for them. e.g. drug addicts, tools to commit suicide with (in some cases) etc.
Thanks, yes my formulation was meant in the interpersonal way you suggest. Your formulation is more precise, so preferable and I will update in the main text.
I agree that the effects you mention are also important.