LAist “Kobe Bryant Sneakers Are Worth Big Bucks: But Not Everybody’s Cashing In” by Austin Cross.
Introduction: The tragic and unexpected death of Kobe Bryant has caused a large spike in demand for his autographed and game-worn memorabilia. Some collectors are choosing to hold on to their merchandise, while others are cashing out now and even trying to buy more so they can sell it at a higher price in the near future. This article explores the personal and economic incentives for holding on to rare memorabilia in a case like this.
Discussion Questions and Answers:
1. The article mentions that whenever a famous person dies, there is a spike in demand for their products. Compare the elasticity of supply of game-worn or autographed Kobe Bryant memorabilia to the elasticity of supply of digital albums from Prince. In which case would we expect prices to rise more? Why?
2. The owners of CoolKicks are intentionally holding product off the market. They claim this is being done for ethical considerations, as they are opposed to “try[ing] to make money off his name.” But how might this actually be a profit-maximizing action for the firm? Could this plan backfire?
3. Rare memorabilia can be seen as an investment in some sense: collectors believe the product will be more valuable in the future and hope to make a return on the money they spent collecting items. How is memorabilia different than other investment vehicles like stocks and bonds? Discuss.