The effects of crowdedness and safety measures on restaurant patronage choices and perceptions in the COVID-19 pandemic

This paper investigates the effects of crowdedness and in-restaurant safety measures on consumers’ restaurant patronage choices (eat-in vs. order takeaway vs. not patronize) and their perceptions during the COVID-19 pandemic. In an online experiment with 593 US consumers and 591 Australian consumers, we assess the effects of three levels of crowdedness (low vs. medium vs. high crowdedness) and four types of in-restaurant safety measures (none vs. partition vs. increasing distances between tables vs. not using in-between tables) by showing participants an image of the restaurant setting. Results show that US consumers are more sensitive to crowdedness, whereas Australian consumers are more sensitive to different types of safety measures, which greatly influence their patronage choices. In general, safety measures featuring social distancing are preferred over partitions, and there is no preferential difference between the measure of increasing distances between tables and the measure of not using in-between tables.     

Accounting for the business cycle: Nominal rigidities, factor heterogeneity, and Austrian capital theory

An Austrian interpretation of the New Keynesian small menu cost model of the business cycle is proposed. Austrian and New Keynesian business cycle theories share the feature that the cycle is generated by rigidities which prevent the economy from adapting instantaneously to changing conditions. Austrian business cycle theory is capital-based, focusing on credit expansion which artificially lowers interest rates and causes an investment boom and unsustainable business expansion. In contrast, the New Keynesian small menu cost model of the business cycle is based on nominal rigidities which prevent markets from clearing. Small menu costs introduce dichotomous behavior, where firms find it locally optimal to avoid instantaneous output price adjustments in the face of the cost, but this local optimum results in economy-wide output and employment fluctuations which are much greater in relative magnitude. The small menu cost model of the business cycle is extended and reinterpreted in light of Austrian business cycle theory with heterogeneous, multiply-specific capital, thus providing a rigorous formalization of the Austrian business cycle. The Austrian interpretation of this New Keynesian model fortuitously addresses several of its shortcomings. JEL classification B53, E12, E23, E32     

Effective restaurant rating scale development and a mystery shopper evaluation approach

Dining is a major attraction for tourists visiting Taiwan. In 2008, the Taipei City Government commissioned a project to produce a list of recommended restaurants in Taipei for tourists. To facilitate the selection process, we developed a restaurant rating scale using a mystery shopper approach. This study entailed 20 questions that covered all elements of the consumers’ dining experience in a table-service restaurant setting, as well as a comprehensive mystery shopper training program to ensure consistency of quality in the evaluation process. This research involved the top 500 restaurants in Taipei. The findings revealed that our rating scale achieves internal consistency, validity and model fit. This study provided an important tool for further industrial applications and research opportunities. Further, this study proposes future research directions.     

The impact of the social servicescape,density, and restaurant type on perceptions of interpersonal service quality

The purpose of this study was to investigate how density in the servicescape affects the three interpersonal dimensions of Stevens et al., (1995) DINESERV conceptualization of service quality (responsiveness, assurance, and empathy) across various restaurant types. Using the framework of information processing theory, it was predicted that when a customer uses density to evaluate anticipated service quality, the information processing style will vary depending on the restaurant context. For fine dining restaurants and sports bars, it was predicted that customers will use heuristic processing, but would use systematic processing when evaluating a family casual restaurant. A 3 (contextual service norms) × 2 (built density) × 2 (human density) between subjects factorial design was employed. The results identified a three-way interaction between human density, built density, and restaurant type, suggesting that the type of restaurant does indeed matter when considering how density impacts potential customers’ perceptions of a restaurant.     

The coevolutionary process of restaurant CSR in the time of mega disruption

This study investigates how US foodservice conglomerates have embarked on corporate social responsibility (CSR) measures to circumvent dire situations during the COVID-19 pandemic. It explores the evolution of CSR practices from restaurant enterprises to rescue and salvage their stakeholders. By analyzing press releases from ten restaurant chains in three different crisis phases (incubation, acceleration, and climax) through corpus linguistics, we identify a CSR progression mechanism that coevolves with the aftermath of the crisis among their stakeholders. This study improvises the CSR- as-process view to highlight the time-variant dynamic nature of CSR development over the course of major disruption.     

Supplier selection and partnerships: Effects upon restaurant operational and strategic benefits and performance

This study focused on identifying strategic criteria involved in selecting suppliers of restaurant products/services specific to casual dining, full service independent restaurants to obtain operational and strategic benefits for those managers operating in this highly competitive marketplace. A total of 765 responses were obtained from managers at independently owned restaurants throughout the U.S. Results revealed that ‘product’ and ‘financial/technical’ criteria had significant and positive effects upon operational benefits, while ‘product’ and ‘service’ had positive effects upon strategic benefits. When the sample was segmented into low and high supplier partnership groups, the positive effects of ‘financial/technical’ and ‘cost/price’ were significantly greater for the ‘high’ partnership group pertaining to operational benefits. ‘Product’ and ‘service’ and their effects upon strategic benefits were greatest for the high partnership group. Based on our findings, implications, limitations, and recommendations for future studies have been provided.     

Price premiums for organic menus at restaurants: What is an acceptable level?

This study identifies acceptable premium price levels that customers would be willing to pay for organic menu items at restaurants in the United States. Previous literature indicates that health-related and socio-demographic characteristics significantly influence consumers’ intentions to purchase organic food. To advance our understanding of how different consumers respond to changes in organic food prices, this study examines the moderating effects of the level of health consciousness (high versus low), gender (male versus female), and age (young versus old) on the relationship between premium price levels and purchasing intentions. In addition, this study further investigates acceptable premium price levels for different consumer segments at two types of restaurants (casual dining versus fine dining). The results of this study provide guidelines for menu design and strategies for restaurateurs to devise effective price premiums for organic menu options.     

To gift or not to gift: How providing a memento affects a restaurant magician’s tips

Tipping is an important source of income for many service workers, who would benefit from a better understanding of things they can do increase their customers’ tips. Among the many studies providing such knowledge are two studies reported by Strohmetz et al. (2002), who found that restaurant servers can increase their tips by leaving their customers with free candy at the completion of the dining experience. The current study tests how the “candy gift” effect generalizes for table magicians who leave their customers with a souvenir playing card. Data suggest that a table magician receives more frequent and larger tips when he gives the customer one of the cards from his deck as a memento. This finding suggests that gift effects on tipping are reliable and generalize beyond gifts of candy from waiters and waitresses. Apparently, workers in different areas of the service industry can use a variety of different gifts to create a need for their customers to reciprocate with larger tips.     

Does offering an organic food menu help restaurants excel in competition? An examination of diners’ decision-making

This study aims to examine whether the presence of an organic food menu can positively influence diners’ decision-making. A 3 (restaurant segment: quick service vs. casual dining vs. fine dining) by 2 (price discrepancy between competing restaurants: small vs. large) scenario-based experiment was conducted with 405 U.S. consumers. MANCOVA results indicate that using organic ingredients offers a greater advantage for the quick-service segment regarding perceived food quality, attitudes towards the restaurant, and willingness to select, compared to casual and fine dining segments. The magnitude of a premium price of organic ingredients negatively influences such advantage in the process of consumers’ decision-making. When a large (vs. small) premium price is charged for using organic ingredients, customers’ preferences for the restaurant (over its rival) significantly drops to such an extent that customers are more willing to choose the competitor (i.e., rival restaurant with a conventional menu). Discussions and implications are further elaborated.     

Determinants of restaurant's owners/managers selection of wines to be offered on the wine list

The aim of the paper is to better understand wine list design in restaurants in four countries with very different wine cultures. An interview protocol was developed and administered to 286 restaurants across the four countries (France, Australia, USA and China). The interview questionnaire included a Best/Worst methodology to identify the most/least important factors influencing the restaurant's owner/manager's selection of wine for the wine list. One of the most important reasons for selecting wine across most countries is ‘to match wine with the food menu’. There were few major differences between countries, but a latent class analysis found four clusters that differed significantly with membership also differing between countries. The cluster analysis also indicated that while some restaurateurs are more brand-driven, others value local wine or its matching with the food menu.