{"id":3768,"date":"2015-09-02T12:47:49","date_gmt":"2015-09-02T07:17:49","guid":{"rendered":"https:\/\/teekhapan.wordpress.com\/?p=3768"},"modified":"2015-09-02T12:47:49","modified_gmt":"2015-09-02T07:17:49","slug":"why-good-restaurants-make-you-wait","status":"publish","type":"post","link":"https:\/\/vivekkaul.com\/2015\/09\/02\/why-good-restaurants-make-you-wait\/","title":{"rendered":"Why ‘good’ restaurants make you wait"},"content":{"rendered":"

\"cutlery\"<\/a>
\nA few weekends back I met a friend, who wanted to study economics, but ended up becoming an engineer under parental pressure. As the story often goes in such cases, he was told by this father that nobody studies \u201cArts\u201d in our family.<\/p>\n

Most Indian universities offer an economics degree under their \u201cArts\u201d course. Would fathers look at their children wanting to study economics differently, if universities offered a BSc in economics rather a B.A.? I really don\u2019t know and that is really not the subject of this column as well.<\/p>\n

I and my friend, met for dinner at a popular restaurant in the Western suburbs of Mumbai. As usual there was a waiting time of 15-20 minutes. Given his passion for economics, this friend has the habit of asking the most unusual questions at the most unlikely places.<\/p>\n

So, here we were standing almost on the road, waiting for a table to eat, and he asked me: \u201cWhy do restaurants make you wait?\u201d I didn\u2019t understand what he was really trying to ask and replied: \u201cWell, because there is only so much space that they have and if more people turn up on a given day, someone has to wait.\u201d<\/p>\n

\u201cYou are not getting my point,\u201d he replied. \u201cWhat I mean is that the restaurant doesn\u2019t benefit in any way, when more people turn up than it has space for. People waiting doesn\u2019t benefit them in any direct way.\u201d<\/p>\n

\u201cYes. So?\u201d I asked.<\/p>\n

\u201cI mean, why not just raise prices and make more money in the process. I am sure enough people would be ready to pay more, if they don\u2019t have to wait. And those who don\u2019t want to pay more, will drop out and go somewhere else. Simple,\u201d he said. \u201cHigher prices will lead to no waiting.\u201d<\/p>\n

We couldn\u2019t continue the conversation because our turn to eat came and there are better things to talk about while eating than economics. Nevertheless, the question stayed with me and a few days later, I luckily discovered the answer, while reading a book by a Nobel Prize winning economist Alvin E. Roth. In Who Gets What and Why\u2014The Hidden World of Matchmaking and Market Design<\/em>, Roth provides the answer to the restaurant question.<\/p>\n

As he writes: \u201cRestaurants don\u2019t just rely on ads to signal how tasty their food is, since any eating establishment can advertise that it serves good food. It\u2019s also a part of the reason restaurants sometimes have prices low enough that long lines form outside.\u201d And how does this help?<\/p>\n

When a customer waits for his turn to eat he is essentially wasting time and this doesn\u2019t help the restaurant either, as my friend had suggested. So why not just raise prices and make more money in the process? And by not raising prices why is the restaurant letting go of the money it could easily make?<\/p>\n

As Roth explains: \u201cThat long line sends a signal that the restaurant across the street with empty tables can\u2019t easily mimic\u2014that is, a lot of people think this is a good restaurant, worth waiting for, and if you haven\u2019t tried it, maybe you should get at the end of the line instead of going across the street.\u201d<\/p>\n

So, long lines go a long way in building the story around any restaurant.<\/p>\n

This also possibly explains why some restaurants survive the test of time despite a fall in quality standards over the years. The lines at the door ensure that people keep coming and convince themselves that the \u201cfood\u201d continues to be as good as it was in the past.<\/p>\n

Further, the lesson here is that next time there is a long line at your favourite restaurant, it might just make sense to hop on to some other place in the vicinity. Chances are that the food might not be that bad. It\u2019s just that the restaurant may have never had the benefit of long lines forming in front of it.<\/p>\n

The column originally appeared in the Bangalore Mirror <\/a>on Sep 2, 2015<\/p>\n","protected":false},"excerpt":{"rendered":"

A few weekends back I met a friend, who wanted to study economics, but ended up becoming an engineer under parental pressure. As the story often goes in such cases, he was told by this father that nobody studies \u201cArts\u201d in our family. Most Indian universities offer an economics degree under their \u201cArts\u201d course. Would … <\/p>\n

Read more<\/a><\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"qubely_global_settings":"","qubely_interactions":"","_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[7,29],"tags":[230,2222],"qubely_featured_image_url":null,"qubely_author":{"display_name":"Vivek Kaul","author_link":"https:\/\/vivekkaul.com\/author\/vivekkaul\/"},"qubely_comment":0,"qubely_category":"Bangalore Mirror<\/a> Easynomics<\/a>","qubely_excerpt":"A few weekends back I met a friend, who wanted to study economics, but ended up becoming an engineer under parental pressure. As the story often goes in such cases, he was told by this father that nobody studies \u201cArts\u201d in our family. Most Indian universities offer an economics degree under their \u201cArts\u201d course. Would…","jetpack_sharing_enabled":true,"jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/vivekkaul.com\/wp-json\/wp\/v2\/posts\/3768"}],"collection":[{"href":"https:\/\/vivekkaul.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/vivekkaul.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/vivekkaul.com\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/vivekkaul.com\/wp-json\/wp\/v2\/comments?post=3768"}],"version-history":[{"count":0,"href":"https:\/\/vivekkaul.com\/wp-json\/wp\/v2\/posts\/3768\/revisions"}],"wp:attachment":[{"href":"https:\/\/vivekkaul.com\/wp-json\/wp\/v2\/media?parent=3768"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/vivekkaul.com\/wp-json\/wp\/v2\/categories?post=3768"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/vivekkaul.com\/wp-json\/wp\/v2\/tags?post=3768"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}