Rationing in restaurants

Thomas von Ungern-Sternberg

International Journal of Industrial Organization, 1991, vol. 9, issue 2, 291-301

Abstract: This paper provides an explanation why consumers are frequently rationed at certain types of restaurants, bars, cafes, etc. The argument is as follows: The more expensive the restaurant is, the lower will be the consumers' consumption per unit of time spent in the restaurant, Restaurants have a fixed seating capacity. When the capacity constraint becomes binding they will set their prices so as to maximise their profits per unit of time the customers spend in the restaurant. It may well be the case, that there is excess demand at this profit maximising price.

Date: 1991
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Persistent link: https://EconPapers.repec.org/RePEc:eee:indorg:v:9:y:1991:i:2:p:291-301

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