Comment Re:errr (Score 1) 128
In a free market, after prices rise due to high demand and limited supply, more supply enters the market in order to capture the additional revenue available from the increased prices and strong demand. In this case, that means theaters would show the movie on more screens (possibly by limiting showings of other movies), thus easing the limited seating availability. If supply is unlimited, prices will naturally settle out at the marginal cost of production. Screens obviously aren't unlimited but there is a fair degree of flexibility to add showings for an in-demand movie to avoid huge price spikes.
Of course that's obviously a very simplistic model. Producers often employ strategies to capture the additional demand-based revenue from "die hard" fans that have to have something right away. Like artificially limiting initial supply and raising prices to capture additional revenue from people that have to have it first, and then opening up the supply and lowering prices shortly after.
Recently there's all these apps and whatnot that bring market-based pricing to bear in a lot of industries where it traditionally wasn't. There are so many instances where this supply part of the equation is missing for various reasons. Like when a performer has a single show in a city and speculators buy up all the seats and resell then at 4x the price. The reason they can get 4x the prices is because no additional supply can enter the market. I've heard Garth Brooks just keeps adding days until a day doesn't sell out to address this problem.