You've sensibly kept your models simple and clean here, but if you ever felt like doing a more complex version the question which really wants addressing is the impact of format legality on card prices. In particular, cards rotating out of Standard seems to cause huge price drops in many cases.
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1. Where are 3.1.3 and 3.1.4?
2. Why does the author seem surprised that aesthetic utility would be a determinant of prices (2.1)? That seems obvious, and foil versus non-foil seems to be a great way to examine that because it includes an inherent "ceteris paribus" quality.
3. Identifying the phenomenon that card prices depreciate over time is the key "interesting" point in the article. Explaining this more fully seems like something to examine in the future.
4. At least in the US, liability on a promissory estoppel theory is way more plausible than an implicit contract theory; it's unclear that there would have been any consideration exchanged between WotC and collectors (3.1.5).
5. Another idea for increasing supply of reserved list cards for the sake of Vintage and Legacy could be the introduction of functional reprints with some kind of rule only allowing players to have one or the other in their lists. The functional reprints could avoid the reprint policy on functional equivalence by using slight differentiation.
6. It could be interesting to investigate how non-reserved vintage/legacy staple prices have moved over time and then to make predictions for modern, the new quasi-"eternal" format.
7. As bateleur points out, one of the most persistent questions of recent years has been what effect dropping out of standard has on a card's price.
8. I wonder if the next article will consider complements. In general, cards that get played together (including those with "synergy" in game parlance) should have correlated prices, and cards that would otherwise have lower prices should have higher prices when they have a staple/bomb/etc. making them good (Snapcaster Mage may have made all kinds of blue instants more valuable, for example).
I really enjoyed the article, are you using R or R commander to create your tables/graphs?
I think this type of analysis is fairly thorough, one factor that may or may not be able to quantify for more accurate analysis is card art (or tribe). One example: angels for instance as being one of the most highly desirable series of collector card. Previously certainly it was a fantastic card for a long time, but what continues to evoke and possibly stimulate price in certain cards is their heritage within the game. So I would point to Serra Angel vs. sengir Vampire, both Uncommons, and if we look many reprints, their more recent values keep consistent with values we might expect, but when you compare A/B prices Serra Angel is double the value. Why, this I suppose was referred to with reference to collections but I think what makes a card collectible beyond its rarity is worthwhile.
If a card at one point holds extreme value does it continue to retain an artificially high value? I think we might see sharp rises and falls in price on certain cards but over a long period of time it would be very interesting to understand the trend of popular card prices more then the gross production of cards.
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As a layman, not an economics major as many that have already posted, I did read the article, understood the graphing and systems, and I just have a few questions. Please forgive me if they seem very obtuse, as I said, not an economics major.
1. Other than 'playing' with numbers, it seems like a lot of work was put into making a proof for information every layman already knew - old cards and limited runs are worth more, utility, rarity, supply and demand, and tournament usage affect card prices. Is this data meant to be applicable to something, or is it just showing the proof of this information?
2. Section 2.1 makes a very bold, I'd even say flat-wrong assumption: Vendors do not collude in any meaningful way...I mean, these pricing numbers don't appear in a vaccuum, nor are they priced individually by every dealer, blind to others' pricing. You even stated yourself that the assumption is fairly weak. Hell, my LGS just looks up SCG pricing when he gets a new card for his stock, and gauges it above/below that accordingly.
3. Can the data you've compiled be applied to explanations for things like 'casual favorites', like Doubling Season or Elvish Piper, where tournament-unplayable cards can still command a premium despite being out-of-format/unused/not particularly undersupplied or in high demand? Likewise, can the data be used to explain/predict why some cards (say, Karn Liberated, for example) retain value past rotation, even if they're not used in the older formats they rotate to?
Well, that's my questions. Forgive me if it came out offensive, I just didn't understand the utility of the information.
I know I already posted, but after reading sephirothx's third point, I wanted to suggest that perhaps loss aversion or some other form of sticky prices could explain why some cards retain value post-rotation. I think the two main hypotheses have gotta be something behavioral like that and expected potential for future tournament play, e.g. Karn was on the cusp of worthiness and then actually saw play in some RG tron lists.
The editors here and at SCG are cagey about publishing this type of article because it might lose some of the audience. I'm glad for all the pertinent comments, questions and critique because it means that there is some interest for this type of analysis--technicality notwithstanding.
At least two of you have mentioned time-based aspects of pricing, e.g. how prices evolve. This is possible, but an easier data collection mechanism is needed. If someone has a bot that can download daily prices, there's at least one article to be written with daily data.
Quote from bataleur »
if you ever felt like doing a more complex version the question which really wants addressing is the impact of format legality on card prices
Wait for Part 2. The results get a bit more interesting (and speculative).
Quote from euknemarchon »
Where are 3.1.3 and 3.1.4?
In Part 2 of the Article. Going from automated LaTeX to manual BBS also means stuff gets lost in translation, sorry.
Quote from euknemarchon »
Does the author seem surprised that aesthetic utility would be a determinant of prices (2.1)?
Yes, he doth. But only because he let his personal bias against foil cards slip in, and didn't edit his predilections out of the article. Econometrically, they should more or less be dealt with implicitly in the set variables.
Quote from euknemarchon »
4. At least in the US, liability on a promissory estoppel theory is way more plausible than an implicit contract theory; it's unclear that there would have been any consideration exchanged between WotC and collectors (3.1.5)
Probably, promissory estoppel seems like it would be weaker in terms of liability though, caveat emptor.
I think WotC's line of, "We can't reprint," doesn't hold legal water--perhaps that should be another article--pm me if some one would be interested in writing it together.
Quote from sephirothx »
just showing the proof of this information?
It does "prove" in some sense this intuition, but more importantly it measures the effect.
Quote from sephirothx »
Vendors do not collude in any meaningful way
I assume they don't collude. Whether they collude or not would only be a real issue if I tried to record multiple observations for the exact same card (it would invalidate the standard errors, i.e. inferences about significance)-so it's probably a confusing side note that should have been eliminated from the BBS version of the article.
Quote from sephirothx »
Can the data you've compiled be applied to explanations for things like 'casual favorites'
In principle yes; it might be hard to draw up a list that is theoretically consistent though. Individual casual card prices perhaps more simply just be evaluated against the price that the model predicts.
That is you substitute all the attributes of the casual card into the equation, and then see if the casual card's actual price is less than or equal to the predicted price.
Quote from EvilNerdINC »
are you using R or R commander to create your tables/graphs?
I use straight up R script; it's a bit arcane, but there is a record of what I've done for reference and reproduction.
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I am legitimately happy that this article was published. I believe that more needs to follow. Money and economics are an important part of the game with a far reach hitting everything from the metagame to whether a LGS can sustain itself to provide tournament play.
This is important information for players, and especially those who sell cards. I've seen a lot of stores open up and close again, and I believe that the pricing of cards has a lot to do with things.
A few things I have to mention:
This article wasn't very layman friendly. I learned most of the information from the article from reading the text. A lot of the people who aren't friendly with numbers might not know what regression is among other things.
"promissory estoppel" - I can make a good guess as to what this is from the context surrounding it, but I'm not entirely sure that I know what this is or if it's common knowledge that I have somehow missed. Things like this should be defined directly and in the simplest way possible.
You covered a lot of information in this article. This could have been more effectively delivered in my opinion if it was spread out into 3 to five articles.
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Probably, promissory estoppel seems like it would be weaker in terms of liability though, caveat emptor.
I think WotC's line of, "We can't reprint," doesn't hold legal water--perhaps that should be another article--pm me if some one would be interested in writing it together.
Actually the reprint policy probably satisfies the classic elements of promissory estoppel. First, WotC introduced the reprint policy reasonably expecting it would induce collectors to buy the listed cards or refrain from selling them. Second, collectors or other players bought or refrained from selling cards in justifiable reliance on WotC's reprint policy. Third, if WotC did print more copies of reprint cards that lowered prices for collectors, then injustice may only be avoidable through cash payments. The only couple of wrinkles here would be in the second element: whether collectors actually made decisions based on WotC's reprint policy and then whether that was justifiable. Yet I don't think it would be hard to get some affidavits from a few big-time collectors saying that the reprint policy had some inducing effect, and WotC's own formality about the reprint policy (e.g., calling it a policy) sorta makes reliance on it justifiable by itself. Finally, there's no "damages" or other standing requirement except for the need to show that injustice can only be avoided through some kind of relief. It's flimsy like that because promissory estoppel is equitable, which is an Anglo-American corner of law where judges often have wide discretion to do what seems right. Summarily, promissory estoppel liability is probably why WotC hasn't already changed the reprint policy (beyond the backlash). Hasbro doesn't need a promissory estoppel class action on its plate.
"promissory estoppel" - I can make a good guess as to what this is from the context surrounding it, but I'm not entirely sure that I know what this is or if it's common knowledge that I have somehow missed. Things like this should be defined directly and in the simplest way possible.
Generally just legal industry people or business people who have taken a business law class should know what promissory estoppel means. In Anglo-American jurisdictions, enforcing a contract generally requires showing that both sides to the contract exchanged something. That's a doctrine called consideration, and it's a mess, but it keeps the courts from enforcing vanilla promises. Over the last hundred-ish years American jurisdictions have developed promissory estoppel; "estoppel" means that the person defending in the lawsuit can't make a defense of some kind because allowing the defense would be unjust. Promissory estoppel, then, occurs where a defendant made a promise and bars or "estops" him from claiming he didn't receive exchange, which would normally obviate his liability. The upshot is that promissory estoppel typically goes in the list of potential ways to do a law suit for breach of contract/promise. See above for thoughts on whether WotC violating its reprint policy would trigger liability. It's odd that the author mentioned it by name in the article; rather than listing legal theories, he probably should have just made a reference to "legal liability" to avoid confusion among the non-legal-types.
As to estoppel:
1. Yes, I agree the original purchasers had (more) than a reasonable expectation that the cards would not printed; indeed this was what motivated wary collectors to purchase these in the first place;
2. My initial reaction was to think that caveat emptor would preclude the detrimental reliance; with a bit more research, I don't think that this defence would work in that the seller controls the purpose fitness of the goods, i.e. for collection. A buyer can't rely on caveat emptor if the goods are not fit for their particular purpose; collection value is only a purpose that can be determined ex post. Collection was one of the main selling points and purposes of the game during the baseball craze; this card backs still bear "The Gathering" as a mark.
3. As far as the third element of "injustice", its clear that some sort of "collection" injustice has been perpetrated. Affidavits would certainly bear that out. It's not clear that the injustice is much more than loss of expected profits (i.e. people still have their collectable cards, albeit their "collectibility" is now diminished)
Now to damages:
A. Damages would limited themselves to the original MSRP + interest + inflation;
B. By privity, only people purchasing original cases and packs would have standing;
C. Only sets after the institution of the policy on March 4th 1996 and before Mercadian Masques would qualify (October 4th, 1999).
Hence, it's not really clear what sort of effective liability they would actually have.
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I guess this is why Wizards was dragging its heels when you asked them for data. They don't want anyone thinking this sort of thought.
Actually, I would guess it's not so much that but that they know some people -already do- think like this. WoTC is made of smart people, and I don't think they are smart+bad. Yes, they are a business and a business is supposed to make money- but does Wal-Mart make profits based on people buying things from the shelves, not opening them, and expecting them to increase in value over time? Nah. Businesses can make all kinds of profit with neutral or negative 'collectability/investment' effect. If the business, as a whole, makes profit, you can invest in the BUSINESS instead of the actual product. Thus the stock market and modern economics.
Wizards would probably like if people saw Magic, the Company, or Magic, the Game as a whole, as a much better investment than individual cards, because that's in fact the Truth, and Truth always makes things better. But they are aware that this simply will not happen. (Perhaps you've heard the phrase 'human nature' mentioned a few times?)
No, the problem is that people THINK their cards should hold value just because some old cards are.....really really ridiculously priced. Basically, we see in Urza's Saga-back the same phenomenon the Comic Books industry has with stuff like Action Comics #1 (1938, not 2011). Collectible value comes down to just two things:
Supply. True Rarity (how many copies exist in the world, not the color of the expansion symbol, which is worse than meaningless because of Pre-Con Decks)
Demand. Condition/Appearance (including how much if any damage, foil or non foil, signed or not signed, etc.)
Power Level in the Game is something which matters in short time periods, but not long ones- Power Creep, Standard Rotation, and various other factors (like the Metagame making Power a Relative value, not an Absolute one) make Power Level in the game not sufficient to really impact cards' long-term value nearly as much as Rarity and Condition.
Power though, DOES indirectly effect Rarity. Things get broken, WotC refuses to reprint. But it's ultimately the Rarity at work, not the Power, because otherwise nobody would ever be able to write "Building on A Budget" or anything like that.
I am probably every color-combination it is possible to be, though it's really hard to figure out what it would mean to be 4-colored....it doesn't seem logical to be 4-colored without being 5-colored.
As to estoppel:
1. Yes, I agree the original purchasers had (more) than a reasonable expectation that the cards would not printed; indeed this was what motivated wary collectors to purchase these in the first place;
2. My initial reaction was to think that caveat emptor would preclude the detrimental reliance; with a bit more research, I don't think that this defence would work in that the seller controls the purpose fitness of the goods, i.e. for collection. A buyer can't rely on caveat emptor if the goods are not fit for their particular purpose; collection value is only a purpose that can be determined ex post. Collection was one of the main selling points and purposes of the game during the baseball craze; this card backs still bear "The Gathering" as a mark.
3. As far as the third element of "injustice", its clear that some sort of "collection" injustice has been perpetrated. Affidavits would certainly bear that out. It's not clear that the injustice is much more than loss of expected profits (i.e. people still have their collectable cards, albeit their "collectibility" is now diminished)
Now to damages:
A. Damages would limited themselves to the original MSRP + interest + inflation;
B. By privity, only people purchasing original cases and packs would have standing;
C. Only sets after the institution of the policy on March 4th 1996 and before Mercadian Masques would qualify (October 4th, 1999).
Hence, it's not really clear what sort of effective liability they would actually have.
Have you studied US law? Maybe you've secretly practiced for several years or something and are drawing on a secret store of knowledge of which I'm not aware. But from my knowledge, caveat emptor is not much of a defense to sale of goods actions in the US given default rule warranties (the direction you're moving to). Further, "privity" doesn't apply to promissory estoppel as far as I know - reasonable expectation of reliance and justifiable reliance soak up all the policy rationale for privity. I listed the actual elements for you and they fit. See Restatement the Second of Contracts § 90. Judges in jurisdictions follow the Restatement (most, since the Restatements popularized promissory estoppel in the US) will have wide discretion to fit remedies to cases at hand. Anybody buying a single on the reprint list (from anybody) in reliance on WotC's policy creating a 40% value increase (you identified statistically) who afterwards sees that 40% evaporate should be able to recover.
> Have you studied US law?
No, only public international law formally, and some UK and Swiss law.
> "privity" doesn't apply to promissory estoppel as far as I know
True; it's contract doctrine. If we admit the collectibility was part of the purpose of the good and the transaction was based on that, it seems hard to believe that WotC can be made liable for all subsequent transactions. In short, I don't believe that all losses third-party transactions can be laid at the feet of WotC due to their reprint changes, which is to induce sales to the first party.
> I listed the actual elements for you and they fit.
I basically agree as well, BUT:
a. I'm not certain what the scope of that obligation actually entails, contrary to some of the estoppel cases, the collectors are only out the initial purchase for which they received a good before the reserved list, i.e. people who purchased the original black lotus cannot did not receive any such warranty.
> Restatement the Second of Contracts § 90.
Third parties apparently have some rights under §90 as you point out, but I thought we agreed it wasn't a contract (apart from initial sales)?
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I agree with all of euknemarchon's statements. I am a licensed attorney in Texas, so i do have something to add to this discussion. This is really not as complicated as most people might think.
I guarantee that Wizards and Hasbo have reviewed the reprint policy and decided that it's not a good business decision to violate it. Damages is really not the issue. The cost of defense is the issue. Whether they could successfully defend a class action lawsuit is less important than the actual expense of defending it. Why risk significant legal expenses when the Company can print money by creating new cards?
Ryusei, is your law firm hiring? I need a summer associate position (2L right now).
EDIT:
To get back on topic, one of the things that's come up is price over time, and Amuraivel understandably pointed to the lack of reliable data. Amuraivel, is Black Lotus Project data available for your analysis? Would that work?
This article is really impressive. As an AP Comp-Sci student in high school I've been working on something similar. My project only encompasses value of standard cards and aims to make profits by predicting changes in price.
Several questions:
1) Do you do your web scraping in Java? I thought I recognized the format of your graphs as those produced by Flanagan's Java Scientific Library, but I'm not sure.
2) I've wondered whether accessing websites' source code repeatedly is actually legal. I think it must be, but I don't know. I assume that since you have done extensive scraping AND study law you might know this.
Overall, thanks so much for publishing this article. You've inspired me to add several factors to my current regression.
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Author of "Flogging the Data"' econometric article series.
You've sensibly kept your models simple and clean here, but if you ever felt like doing a more complex version the question which really wants addressing is the impact of format legality on card prices. In particular, cards rotating out of Standard seems to cause huge price drops in many cases.
(I'm on on this site much anymore. If you want to get in touch it's probably best to email me: dom@heffalumps.org)
Forum Awards: Best Writer 2005, Best Limited Strategist 2005-2012
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MTGSalvation Articles: 1-20, plus guest appearance on MTGCast #86!
<Limited Clan>
1. Where are 3.1.3 and 3.1.4?
2. Why does the author seem surprised that aesthetic utility would be a determinant of prices (2.1)? That seems obvious, and foil versus non-foil seems to be a great way to examine that because it includes an inherent "ceteris paribus" quality.
3. Identifying the phenomenon that card prices depreciate over time is the key "interesting" point in the article. Explaining this more fully seems like something to examine in the future.
4. At least in the US, liability on a promissory estoppel theory is way more plausible than an implicit contract theory; it's unclear that there would have been any consideration exchanged between WotC and collectors (3.1.5).
5. Another idea for increasing supply of reserved list cards for the sake of Vintage and Legacy could be the introduction of functional reprints with some kind of rule only allowing players to have one or the other in their lists. The functional reprints could avoid the reprint policy on functional equivalence by using slight differentiation.
6. It could be interesting to investigate how non-reserved vintage/legacy staple prices have moved over time and then to make predictions for modern, the new quasi-"eternal" format.
7. As bateleur points out, one of the most persistent questions of recent years has been what effect dropping out of standard has on a card's price.
8. I wonder if the next article will consider complements. In general, cards that get played together (including those with "synergy" in game parlance) should have correlated prices, and cards that would otherwise have lower prices should have higher prices when they have a staple/bomb/etc. making them good (Snapcaster Mage may have made all kinds of blue instants more valuable, for example).
I think this type of analysis is fairly thorough, one factor that may or may not be able to quantify for more accurate analysis is card art (or tribe). One example: angels for instance as being one of the most highly desirable series of collector card. Previously certainly it was a fantastic card for a long time, but what continues to evoke and possibly stimulate price in certain cards is their heritage within the game. So I would point to Serra Angel vs. sengir Vampire, both Uncommons, and if we look many reprints, their more recent values keep consistent with values we might expect, but when you compare A/B prices Serra Angel is double the value. Why, this I suppose was referred to with reference to collections but I think what makes a card collectible beyond its rarity is worthwhile.
If a card at one point holds extreme value does it continue to retain an artificially high value? I think we might see sharp rises and falls in price on certain cards but over a long period of time it would be very interesting to understand the trend of popular card prices more then the gross production of cards.
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1. Other than 'playing' with numbers, it seems like a lot of work was put into making a proof for information every layman already knew - old cards and limited runs are worth more, utility, rarity, supply and demand, and tournament usage affect card prices. Is this data meant to be applicable to something, or is it just showing the proof of this information?
2. Section 2.1 makes a very bold, I'd even say flat-wrong assumption: Vendors do not collude in any meaningful way...I mean, these pricing numbers don't appear in a vaccuum, nor are they priced individually by every dealer, blind to others' pricing. You even stated yourself that the assumption is fairly weak. Hell, my LGS just looks up SCG pricing when he gets a new card for his stock, and gauges it above/below that accordingly.
3. Can the data you've compiled be applied to explanations for things like 'casual favorites', like Doubling Season or Elvish Piper, where tournament-unplayable cards can still command a premium despite being out-of-format/unused/not particularly undersupplied or in high demand? Likewise, can the data be used to explain/predict why some cards (say, Karn Liberated, for example) retain value past rotation, even if they're not used in the older formats they rotate to?
Well, that's my questions. Forgive me if it came out offensive, I just didn't understand the utility of the information.
At least two of you have mentioned time-based aspects of pricing, e.g. how prices evolve. This is possible, but an easier data collection mechanism is needed. If someone has a bot that can download daily prices, there's at least one article to be written with daily data.
Wait for Part 2. The results get a bit more interesting (and speculative).
In Part 2 of the Article. Going from automated LaTeX to manual BBS also means stuff gets lost in translation, sorry.
Yes, he doth. But only because he let his personal bias against foil cards slip in, and didn't edit his predilections out of the article. Econometrically, they should more or less be dealt with implicitly in the set variables.
Probably, promissory estoppel seems like it would be weaker in terms of liability though, caveat emptor.
I think WotC's line of, "We can't reprint," doesn't hold legal water--perhaps that should be another article--pm me if some one would be interested in writing it together.
It does "prove" in some sense this intuition, but more importantly it measures the effect.
I assume they don't collude. Whether they collude or not would only be a real issue if I tried to record multiple observations for the exact same card (it would invalidate the standard errors, i.e. inferences about significance)-so it's probably a confusing side note that should have been eliminated from the BBS version of the article.
In principle yes; it might be hard to draw up a list that is theoretically consistent though. Individual casual card prices perhaps more simply just be evaluated against the price that the model predicts.
That is you substitute all the attributes of the casual card into the equation, and then see if the casual card's actual price is less than or equal to the predicted price.
I use straight up R script; it's a bit arcane, but there is a record of what I've done for reference and reproduction.
Author of "Flogging the Data"' econometric article series.
This is important information for players, and especially those who sell cards. I've seen a lot of stores open up and close again, and I believe that the pricing of cards has a lot to do with things.
A few things I have to mention:
This article wasn't very layman friendly. I learned most of the information from the article from reading the text. A lot of the people who aren't friendly with numbers might not know what regression is among other things.
"promissory estoppel" - I can make a good guess as to what this is from the context surrounding it, but I'm not entirely sure that I know what this is or if it's common knowledge that I have somehow missed. Things like this should be defined directly and in the simplest way possible.
You covered a lot of information in this article. This could have been more effectively delivered in my opinion if it was spread out into 3 to five articles.
Best video games of all time:
4. Metal Gear Solid
3. Super Mario 64
2. Ocarina of Time
1. Cave Story
^ Seriously, play it and thank me later.
I guess this is why Wizards was dragging its heels when you asked them for data. They don't want anyone thinking this sort of thought.
Actually the reprint policy probably satisfies the classic elements of promissory estoppel. First, WotC introduced the reprint policy reasonably expecting it would induce collectors to buy the listed cards or refrain from selling them. Second, collectors or other players bought or refrained from selling cards in justifiable reliance on WotC's reprint policy. Third, if WotC did print more copies of reprint cards that lowered prices for collectors, then injustice may only be avoidable through cash payments. The only couple of wrinkles here would be in the second element: whether collectors actually made decisions based on WotC's reprint policy and then whether that was justifiable. Yet I don't think it would be hard to get some affidavits from a few big-time collectors saying that the reprint policy had some inducing effect, and WotC's own formality about the reprint policy (e.g., calling it a policy) sorta makes reliance on it justifiable by itself. Finally, there's no "damages" or other standing requirement except for the need to show that injustice can only be avoided through some kind of relief. It's flimsy like that because promissory estoppel is equitable, which is an Anglo-American corner of law where judges often have wide discretion to do what seems right. Summarily, promissory estoppel liability is probably why WotC hasn't already changed the reprint policy (beyond the backlash). Hasbro doesn't need a promissory estoppel class action on its plate.
Generally just legal industry people or business people who have taken a business law class should know what promissory estoppel means. In Anglo-American jurisdictions, enforcing a contract generally requires showing that both sides to the contract exchanged something. That's a doctrine called consideration, and it's a mess, but it keeps the courts from enforcing vanilla promises. Over the last hundred-ish years American jurisdictions have developed promissory estoppel; "estoppel" means that the person defending in the lawsuit can't make a defense of some kind because allowing the defense would be unjust. Promissory estoppel, then, occurs where a defendant made a promise and bars or "estops" him from claiming he didn't receive exchange, which would normally obviate his liability. The upshot is that promissory estoppel typically goes in the list of potential ways to do a law suit for breach of contract/promise. See above for thoughts on whether WotC violating its reprint policy would trigger liability. It's odd that the author mentioned it by name in the article; rather than listing legal theories, he probably should have just made a reference to "legal liability" to avoid confusion among the non-legal-types.
1. Yes, I agree the original purchasers had (more) than a reasonable expectation that the cards would not printed; indeed this was what motivated wary collectors to purchase these in the first place;
2. My initial reaction was to think that caveat emptor would preclude the detrimental reliance; with a bit more research, I don't think that this defence would work in that the seller controls the purpose fitness of the goods, i.e. for collection. A buyer can't rely on caveat emptor if the goods are not fit for their particular purpose; collection value is only a purpose that can be determined ex post. Collection was one of the main selling points and purposes of the game during the baseball craze; this card backs still bear "The Gathering" as a mark.
3. As far as the third element of "injustice", its clear that some sort of "collection" injustice has been perpetrated. Affidavits would certainly bear that out. It's not clear that the injustice is much more than loss of expected profits (i.e. people still have their collectable cards, albeit their "collectibility" is now diminished)
Now to damages:
A. Damages would limited themselves to the original MSRP + interest + inflation;
B. By privity, only people purchasing original cases and packs would have standing;
C. Only sets after the institution of the policy on March 4th 1996 and before Mercadian Masques would qualify (October 4th, 1999).
Hence, it's not really clear what sort of effective liability they would actually have.
Author of "Flogging the Data"' econometric article series.
Actually, I would guess it's not so much that but that they know some people -already do- think like this. WoTC is made of smart people, and I don't think they are smart+bad. Yes, they are a business and a business is supposed to make money- but does Wal-Mart make profits based on people buying things from the shelves, not opening them, and expecting them to increase in value over time? Nah. Businesses can make all kinds of profit with neutral or negative 'collectability/investment' effect. If the business, as a whole, makes profit, you can invest in the BUSINESS instead of the actual product. Thus the stock market and modern economics.
Wizards would probably like if people saw Magic, the Company, or Magic, the Game as a whole, as a much better investment than individual cards, because that's in fact the Truth, and Truth always makes things better. But they are aware that this simply will not happen. (Perhaps you've heard the phrase 'human nature' mentioned a few times?)
No, the problem is that people THINK their cards should hold value just because some old cards are.....really really ridiculously priced. Basically, we see in Urza's Saga-back the same phenomenon the Comic Books industry has with stuff like Action Comics #1 (1938, not 2011). Collectible value comes down to just two things:
Supply. True Rarity (how many copies exist in the world, not the color of the expansion symbol, which is worse than meaningless because of Pre-Con Decks)
Demand. Condition/Appearance (including how much if any damage, foil or non foil, signed or not signed, etc.)
Power Level in the Game is something which matters in short time periods, but not long ones- Power Creep, Standard Rotation, and various other factors (like the Metagame making Power a Relative value, not an Absolute one) make Power Level in the game not sufficient to really impact cards' long-term value nearly as much as Rarity and Condition.
Power though, DOES indirectly effect Rarity. Things get broken, WotC refuses to reprint. But it's ultimately the Rarity at work, not the Power, because otherwise nobody would ever be able to write "Building on A Budget" or anything like that.
People need to read this fanfiction, though:
www.hpmor.com
I am probably every color-combination it is possible to be, though it's really hard to figure out what it would mean to be 4-colored....it doesn't seem logical to be 4-colored without being 5-colored.
Have you studied US law? Maybe you've secretly practiced for several years or something and are drawing on a secret store of knowledge of which I'm not aware. But from my knowledge, caveat emptor is not much of a defense to sale of goods actions in the US given default rule warranties (the direction you're moving to). Further, "privity" doesn't apply to promissory estoppel as far as I know - reasonable expectation of reliance and justifiable reliance soak up all the policy rationale for privity. I listed the actual elements for you and they fit. See Restatement the Second of Contracts § 90. Judges in jurisdictions follow the Restatement (most, since the Restatements popularized promissory estoppel in the US) will have wide discretion to fit remedies to cases at hand. Anybody buying a single on the reprint list (from anybody) in reliance on WotC's policy creating a 40% value increase (you identified statistically) who afterwards sees that 40% evaporate should be able to recover.
No, only public international law formally, and some UK and Swiss law.
> "privity" doesn't apply to promissory estoppel as far as I know
True; it's contract doctrine. If we admit the collectibility was part of the purpose of the good and the transaction was based on that, it seems hard to believe that WotC can be made liable for all subsequent transactions. In short, I don't believe that all losses third-party transactions can be laid at the feet of WotC due to their reprint changes, which is to induce sales to the first party.
> I listed the actual elements for you and they fit.
I basically agree as well, BUT:
a. I'm not certain what the scope of that obligation actually entails, contrary to some of the estoppel cases, the collectors are only out the initial purchase for which they received a good before the reserved list, i.e. people who purchased the original black lotus cannot did not receive any such warranty.
> Restatement the Second of Contracts § 90.
Third parties apparently have some rights under §90 as you point out, but I thought we agreed it wasn't a contract (apart from initial sales)?
Author of "Flogging the Data"' econometric article series.
I guarantee that Wizards and Hasbo have reviewed the reprint policy and decided that it's not a good business decision to violate it. Damages is really not the issue. The cost of defense is the issue. Whether they could successfully defend a class action lawsuit is less important than the actual expense of defending it. Why risk significant legal expenses when the Company can print money by creating new cards?
EDIT:
To get back on topic, one of the things that's come up is price over time, and Amuraivel understandably pointed to the lack of reliable data. Amuraivel, is Black Lotus Project data available for your analysis? Would that work?
Several questions:
1) Do you do your web scraping in Java? I thought I recognized the format of your graphs as those produced by Flanagan's Java Scientific Library, but I'm not sure.
2) I've wondered whether accessing websites' source code repeatedly is actually legal. I think it must be, but I don't know. I assume that since you have done extensive scraping AND study law you might know this.
Overall, thanks so much for publishing this article. You've inspired me to add several factors to my current regression.