Creating artificial shortage and than charging overprices is not a normal free market process. Businesses should create added value, then they can charge a price for it.
Actors that misuse or unfairly dominate free markets will trigger regulation, that's the way it has always been. Some regulators are weak, so we still have endure cancers like Google and Microsoft.
There is no artificial shortage, there is an inherent shortage. Sufficiently popular entertainers such that a ticket price arbitrage opportunity exists must be, by definition, in short supply.
There exist only so many performance days in an entertainer’s lifetime. And, obviously, venues have capacity limits.
In theory they provide market liquidity such that for anyone who REALLY wants to go, at any time prior to and potentially even during the event, there remain some options available for purchase; as opposed to basically spinning the lottery on whether you get to go or not, especially for oversubscribed events.
Hmm, it seems like we've forgotten that we can vote with our wallet. If this practice wasn't desired because it raised prices too much or some other reason, then people wouldn't give the resellers their money.
First come first serve, or a lottery, or any number of other algorithms. The point being "the people with the most money" isn't the algorithm that everyone wants.
The idea is that if venues can sell tickets at higher prices, to the rich or silly (via resellers or not), you get more venues and more acts, even at the low end where tickets are cheap, because it's bigger business.
Nobody wants an algorithm that leaves them without a ticket, and that includes your proposals.
> the people with the most money
That's not the algorithm employed. The algorithm is "the people who are willing to outbid the others". That is quite different.
Besides, with a lottery you won't know if you got the ticket until the last minute. How are you going to make plans with your sweetie, then? Or are traveling from out of town?
During communist years here in Eastern Europe, we got to experience the "knowing people in the Nomenklatura and Party" resource allocation algorithm.
It was obvious to us that the "people with most money" algorithm was vastly superior since it made people work harder to get those money, thus enhancing the society. Also, the extra cash strongly incentivized and funded people to create more of the scarce resource.
The other algorithms failed to incentivize to such a degree that in the end we were starving and freezing because nobody wanted to work to create food, heat or any other products and services anymore.
Actors that misuse or unfairly dominate free markets will trigger regulation, that's the way it has always been. Some regulators are weak, so we still have endure cancers like Google and Microsoft.