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Here is an article on the latest Michelin stars for Chicago Restaurants. The very nice thing about this article is that it tells you which restaurants just missed getting a star. As of yesterday you would have preferred the now-starred restaurants over the now-snubbed restaurants. But probably as of today that preference is reversed.
Here is a nice essay on the idea that “over thinking” causes choking. It begins with this study:
A classic study by Timothy Wilson and Jonathan Schooler is frequently cited in support of the notion that experts, when performing at their best, act intuitively and automatically and don’t think about what they are doing as they are doing it, but just do it. The study divided subjects, who were college students, into two groups. In both groups, participants were asked to rank five brands of jam from best to worst. In one group they were asked to also explain their reasons for their rankings. The group whose sole task was to rank the jams ended up with fairly consistent judgments both among themselves and in comparison with the judgments of expert food tasters, as recorded in Consumer Reports. The rankings of the other group, however, went haywire, with subjects’ preferences neither in line with one another’s nor in line with the preferences of the experts. Why should this be? The researchers posit that when subjects explained their choices, they thought more about them.
Should restaurants put salt shakers on the table? A variety of food writers weigh in on the question here.
The naive argument is that salt shakers give diners more control. They know their own tastes and can fine tune the salt to their liking. The problem with this argument is that salt shaken over prepared food is not the same as salt added to food as it is cooked. A chef adds salt numerous times through the cooking process to different items on the plate because some need more salt than others.
So the benefit of control comes at the cost of excess uniformity in the flavor. But beyond that, there is an interesting strategic issue. When there is no salt shaker on the table the chef chooses the level of saltiness to meet some median or average diner’s taste for salt. All diners get equally salty food independent of their taste. Diners to the left of the median find their dish too salty and diners to the right wish they had a salt shaker.
A reduction in the level of saltiness benefits those just to the left of the median at the expense of those far to the right and at an optimum those costs outweigh the benefits.
But when there is a salt shaker, the chef can reduce the level of saltiness at a lower cost because those to the right can compensate (albeit imperfectly) by adding back the salt. So in fact the optimal level of salt added by a chef whose restaurant puts salt shakers on the table is lower.
So the interesting observation is that salt shakers on the table benefit diners who like less salt (and also those that like a lot of salt) at the expense of the average diner (who would otherwise be getting his salt bliss point but is now getting too little).
Imagine that the President convenes his top economic advisors to get a recommendation on a pressing policy issue. They say unequivocally “do X.” The President asks why and they say “its complicated. Do X.” The President, not happy with that, decides he is going to read the economic literature on the pros and cons of doing X. After a thorough study he comes back to his advisors and says “You economists don’t understand your own science. I read the literature and I should do Y.”
I think we would agree that’s a bad outcome. For probably exactly the same reason that Doctors don’t seem to be happy with economist Emily Oster’s apparent advice to pregnant women to drink alcohol “like a European adult.”
But let’s assume that Emily truly can interpret the published statistical literature better than her Obstetrician. There is another reason to question her recommendations.
An advisor’s job is to advise on the risks of an activity. Because the advisor is the expert on that. The decision-maker is the expert on her own preferences. The correct decision is based on weighing both of these.
A recommendation to have up to a glass of wine per day while pregnant confounds the two sides. What it really means is “I like wine a lot. I also read about the risks and decided that my taste for wine was strong enough that I am willing to live with the risks.” Thus her recommendation amounts to “If you like wine as much as I do you should drink up to a glass per day when you are pregnant.”
When I asked my doctor about drinking wine, she said that one or two glasses a week was “probably fine.” But “probably fine” isn’t a number.
The problem is that there is no way to quantify how much she likes wine and so no way for her readers to know whether they like wine as much as she does. Likewise it is too much for Emily to demand her doctors to say much more than “probably fine.”
The doctors’ advice is based on some assumption about the patient’s taste for wine weighed against the risks. Emily’s advice is based on a different assumption. As for the risks, when Emily reads the literature and concludes that the evidence is weak of the danger of drinking alcohol she then jumps to the conclusion that it is weaker than what the doctors thought. She makes the identifying assumption that their recommendation was conservative because they overestimated the risks and not because they underestimated her taste for wine. But there does not seem to be any basis for that assumption because her doctors never told her what they believed the risks to be and they never asked her how much she likes wine.
Its called Chhota Pegs and so far has been mostly a chronicle of a visit to Calcutta (his hometown?) where food seems to be the star attraction:
Now this is the hard part. The damn thing must cook above and below but it is thick, and hard to turn over. On the other hand if you don’t turn it over the potatoes will burn. So what you do is cook it for a while (covered if needed) until you can move the pan and have the entire omelette wobble in it. The top will still be uncooked (if it is cooked, I’m guessing the bottom is burnt).
Then (and here you must take a large swig of what’s left of the Bloody Mary / Laphroaig and if you are married and male, remove spouse from kitchen) cover the pan with the snug plate, put on the oven mitts, and turn the whole contraption over until the omelette is on the plate. Or at least, try turning it.
Do not forget the oven mitts as you will have to grab the bottom of the pan. Exhortations such as Allah ho Akbar, Joy Ma Kali or milder (Hare Krishna!) or even secular variants, such asBande Mataram, are useful here. Indeed, I encourage them.
With a sprinkling of Peter Hammond:
Thanks to Diego Garcia (uninhabited except temporarily by various U.K. and U.S. military personnel) and to Pitcairn (population now about 50), the British Empire appears safe from sunsets for the time being. (Both these territories have websites, by the way, though that for Diego Garcia is maintained by the U.S. Navy at www.nctsdg.navy.mil.) But the sun will be getting very low over the British Empire at around 01:40 GMT in late June each year….
Also, it seems that the sun could finally set over the British Empire if the sea level were to rise high enough because of global warming. It turns out that Diego Garcia has a mean elevation of only 4 feet above sea level, and a maximum elevation of only 22 feet. Perhaps the U.S. Navy will erect dikes around their strategically located communication facilities…
And Paul Dirac:
“[W]e have an economic system which tries to maintain an equality of value between two things, which it would be better to recognize from the beginning as of unequal value. These two things are the receipt of a single payment (say 100 crowns) and the receipt of a regular income (say 3 crowns a year) all through eternity…May I ask you to trace out for yourselves how all the obscurities become clear, if one assumes from the beginning that a regular income is worth incomparably more, in fact infinitely more, in the mathematical sense, than any single payment?” (From Dirac’s biography, The Strangest Man, by Graham Farmelo. Highly recommended btw.)Coming from a physics genius, this is quite stunning in its stupidity. The most charitable thing I can say about the bloke is that he certainly wasn’t a hyperbolic discounter. (Never mind.) I find particularly telling the following observations: (a) how winning the Nobel prize appears to confer intellectual “rights” over other disciplines that one just don’t have the ability to exercise, but more importantly (b) how fundamentally “intuition” differs from field to field, so that a genius in one area can be a blithering idiot in another.
And I have been to many very good Chinese restaurants in China, Taiwan, Singapore etc. This place is called Peter Chang’s China Grill. Here’s Wikipedia about the chef. Here are the badly misguided Yelp reviews. Note that from the look of the restaurant, the location, the service you would never guess what was in store for you. Indeed I was terrified when the folks at UVA told me we were driving off campus to go have Chinese for lunch, even moreso when I saw the place they were taking me to. But the food was a revelation. You probably do need to know what and how to order. For that I suggest getting invited to give a talk at the University of Virginia Economics department.
People don’t like to be idle. They are willing to spend energy on pointless activities just to avoid idleness. But they are especially willing to do that if they can make up fake reasons to justify the unproductive busyness. That’s the conclusion from a clever experiment Emir Kamenica told me about.
In this experiment subjects who had just completed a survey were told they had to deliver the survey to one of two locations before being presented with the next survey 15 minutes later. They could walk and deliver to a faraway location, about a 15 minute roundtrip, or deliver it nearby, in which case they would have to stand around for the remainder of the 15 minutes.
There was candy waiting for them at the delivery point. In a benchmark treatment it was the same candy at each location. In that treatment the majority of subjects opted for the short walk and idleness.
In a second treatment two different, but equally attractive (experimentally verified) types of candy were available at the two locations and the subjects were told this. In this treatment the majority of subjects walked the long distance.
The researchers conclude that the subjects wanted to avoid idleness and rationalized the effort spent by convincing themselves that they were getting the better reward. Indeed the subjects who traveled far reported greater happiness than their idle counterparts regardless of what candy was available.
Here’s a thought I had over a lunch of Mee Goreng and Rojak. As the cost of transportation declines there is a non-monotonic effect on migration. Decreasing transportation costs make it cheaper to visit and discover new places. But for small cost reductions it is still too costly to visit frequently. So if you find a place you like you must migrate there.
For large declines in transportation costs, it becomes cheap to frequently visit the places that you like and you would otherwise want to migrate to. So migration declines.
The same non-monotonic effect can be seen as a function of distance. For any given decline in transportation costs migration to far away destinations increases but migration to nearer destinations declines.
For the vapor mill it means that over time between any two locations you should first see migration increase then decrease. And the switching point from increase to decrease should come later for locations farther apart.
By the way if you would like to see more pictures of delicious food in Singapore you can follow my photo stream. But beware it might make you want to migrate.
The other day I heard this chef talking on the radio about dropping lobsters into boiling water. The question was whether this or any other method of cooking live lobster was humane. Specifically he was focusing on the question of whether the lobster feels pain. The chef’s preferred method was to first put the lobster in the freezer until it stops moving and then drop it into boiling water.
Of course there is no way to know whether the lobster feels pain from being boiled alive but we can ask whether there is any theoretical reason it would feel pain. In creatures that feel it, pain is a selected response to a condition in the environment that is to be avoided. Notice an implication of this: being a (life-)threatening is a necessary but not sufficient condition for some environmental feature to induce the response of pain.
Apparently humans do not feel pain, or anything at all, when exposed to life-threatening carbon monoxide. Presumably that is because relative to the span of time it takes to evolve a protective painful response, carbon monoxide has not been a relevant threat for very long. No response has been selected for yet.
Does a lobster ever encounter hot water in its natural environment? Is there any channel through which natural selection would have given lobsters a painful response to being boiled? What about being frozen?
Organic can modify a single noun like raspberry. The resultant unit can then itself be used as a modifier of fruit spread. That would yield [[organic raspberry] [fruit [spread]]], denoting a fruit spread of the organic raspberry type. Perfectly grammatical; nothing amiss.
The difference is that the stuff referred to by this description needn’t fully satisfy the stringent conditions for being an organic product. Only the raspberries need to pass. And sure enough, the label on Nature’s Promise Organic Raspberry Fruit Spread says:
INGREDIENTS: ORGANIC SUGAR, ORGANIC RASPBERRIES, WATER, FRUIT PECTIN, CITRIC ACID, CALCIUM CHLORIDE.
A monopolist considers whether to disclose some information about its product. The information will affect how the consumer values the product but its impossible to predict in advance how the consumer will react. With probability q the consumer will view it as good news and he would be willing to pay a high price V for the product. But with probability 1-q it will be viewed as bad news and the consumer would only be willing to pay a low price v where 0 < v < V.
The consumer’s reaction to the information is subjective and cannot be observed by the monopolist. That is, after disclosing the information, the monopolist can’t tell whether the consumer’s willingness to pay has risen to V or fallen to v.
In the absence of disclosure, the consumer is uncertain whether his the value is V or v and so his willingness to pay is equal to the expected value of the product, i.e. qV + (1-q)v. This is therefore the price the monopolist can earn.
Supposing that the monopolist can costlessly disclose the information, what would its profits be then? It won’t continue to charge the same price. Because with probability (1-q) the consumer’s willingness to pay has dropped to v and he would refuse to buy at a price of qV +(1-q)v. At that price he will buy only with probability q and since that would be true at any price up to V, the monopolist would do better setting a price of V and earning expected profit qV.
Alternatively he could set a price of v. For sure the consumer would agree to that price (whether his willingness to pay is V or v) and so profits will be v. And since this is the highest price that would be agreed to for sure, v and V are the only prices the monopoly would consider. The choice will depend on which is larger qV or v.
But note that both qV and v are smaller than qV +(1-q)v. Disclosing information lowers monopoly profits and so the information will be kept hidden.
This little model can play a role in the debate about mandatory calorie labeling.
If you are a parent you probably know of a few kids who have life-threatening allergies. And if you are forty-something like me you probably didn’t know anybody with life-threatening food allergies when you were a kid. It seems like the prevalence of food allergies have increased ten-fold in the last thirty years. Which seems impossible.
Here’s one potential explanation. Suppose that a small percentage of people have a life-threatening allergy to, say, peanuts. And suppose that doctors begin more carefully screening kids for potential food allergies. For example, a kid who gets a rash after eating something is given a skin test or blood test. A positive test correlates with food allergy but does not conclusively demonstrate it. In addition the test cannot distinguish a mild allergy from one that is life threatening.
But life-threatening food allergies are life threatening. The risk is so great that any child with a non-negligible probability of having it should be restricted from eating peanuts. Such a child will return to school with a note from the doctor that there should be no peanuts in class because of the risk of a life-threatening allergic reaction. This is what’s knows as “being allergic to peanuts.”
This is all unassailable behavior on everybody’s part. And note that what it means is that while there continues to be just a small percentage of people who are deathly allergic to peanuts, there is a much larger percentage of people who, perfectly rightly, avoid peanuts because of the significant chance it could give them a life-threatening allergic reaction.
This is kinda gross:
In a new paper published online Oct. 8 in the journal Cell, Breslin and colleagues propose a theory of food pairings that explains for the first time how astringent and fatty foods oppose one another to create a balanced “mouthfeel.”
Because fat is oily, eating it lubricates the mouth, making it feel slick or even slimy, Breslin said. Meanwhile, astringents, chemical compounds such as the tannins in wine and green tea, make the mouth feel dry and rough. They do this by chemically binding with lubricant proteins present in saliva, causing the proteins to clump together and solidify, and leaving the surface of the tongue and gums without their usual coating of lubrication. [Tip of the Tongue: The 7 (Other) Flavors Humans May Taste]
We don’t like slimy, but we don’t like puckered up, either. “We want our mouth to be lubricated but not overly lubricated,” Breslin told LiveScience. “In our study, we show that astringents reduce the lubricants in the mouth during a fatty meal and return balance.”
- Its socially valuable for the University of Michigan measure consumer confidence and announce it even if that is an irrelevant statistic. Because otherwise somebody with less neutral motives would invent it, manipulate it, and publicize it.
- Kids are not purely selfish. They like it when they get better stuff than their siblings. To such an extent that they often feel mistreated when they see a sibling get some goodies.
- Someone should develop a behavioral theory of how people play Rock, Scissors, Paper when its common knowledge that humans can’t generate random sequences.
- The shoulder is the kludgiest joint because there are infinitely many ways to do any one movement. Almost surely you have settled into a sub-optimal way.
- I go to a million different places for lunch but at each one I always order one dish.
I remember a commercial for some kind of diet program where that was the tagline. A disembodied hand kept enticing this poor guy with delicious looking food and then taking it away because it was unhealthy and then the voiceover came in with that line and I thought that was so tragic that everything that tastes good had to be bad for you. Like what kind of cruel joke is that?
And it makes no sense from a biological point of view. I should want to eat what’s good for me so that I do eat what’s good for me and avoid what’s bad for me. That’s Mother Nature’s optimal incentive scheme. And once we have evolved to the point that we can think and understand that principle we should be able to infer that whatever tastes good must in fact be good for us. But it’s not!
At the margin it’s not. Indeed the right statement is “If it tastes good then you surely have already had too much of it to the point that any more of it is bad for you.” Because the basic elements in food that we love, namely sugar, salt, and fat, are all not just good for us but pretty much essential for survival. And so of course we are programmed to like those things enough that we are incentivized to consume enough of them to survive.
But the decision whether to eat something is based on costs as well as benefits. Nature programmed our tastes so that we internalize the benefits but it’s up to us to figure out the costs: how abundant is it, how hard is it to acquire, and when it’s sitting there before us how likely is it that we will have a chance to eat it again in the near future. Then we need to weigh the costs and benefits and eat up to the quantity where marginal costs equal marginal benefits.
It’s interesting that Nature put a little price theory to use when she worked all this out. A price is a linear incentive scheme. Every additional unit you buy costs you the same price as the last one. Your taste for food is like a linear subsidy, every unit tastes about as good as the last, at least up to a point. When you face linear incentives like that you consume up to the point where your personal, idiosyncratic marginal cost equals the given marginal benefit. If a planner (like your Mother Nature) wants to get you to equate marginal cost and marginal benefit, a (negative) price is a crude incentive scheme because the true marginal benefits might be varying with quantity but the subsidy makes you act as if its constant.
But that’s ok when the price is set right. The planner just sets the subsidy equal to the marginal benefit at the optimal quantity. Then when you choose that quantity you will in fact be equating marginal cost to the true marginal benefit. That’s a basic pillar of price theory.
So Nature assumed she knew pretty well what the optimal quantity of sugar, salt, and fat are and gave us a taste for those elements that was commensurate with the true marginal benefit at that optimal point. And its pretty much a linear incentive scheme at least in a large neighborhood of the target quantity. Sugar, salt and fat don’t seem to diminish in appeal until we have had quite a lot of it.
The problem is that the optimal quantity depends on both the value function and the cost function. Now the value function, i.e. the health benefits of various consumption levels is probably the same as it has always been. But the cost function has changed a lot. Nature was never expecting Mountain Dew, Potato Chips and Ice Cream. The reduction in marginal cost means that the optimal quantity is higher, but how much higher? That depends on how the shape of the value function at higher quantities. The old linear incentive scheme contains no information at all about that.
But one thing is for sure. If the true marginal benefit is declining, then at higher quantities the linear incentive scheme built into our taste buds overstates the marginal benefit. So when we equate the new marginal cost to the linear price we are doing what is privately optimal for us but what is certainly too high compared to Nature’s optimum. If it tastes good its bad for us we because we have already had too much.
I had just eaten a little plastic carton of yogurt and I tossed it into the recycling bin. She said “That yogurt carton needs to be rinsed before you can recycle it.” And I thought to myself “That can’t be true. First of all, the recyclers are going to clean whatever they get before they start processing it so it would be a waste for me to do it here. Plus, the minuscule welfare gains from recycling this small piece of plastic would be swamped by water, labor, and time costs of rinsing it.” I concluded that, as a matter of policy, I will not rinse my recyclable yogurt containers.
So I replied “Oh yeah you’re right.”
You see, I didn’t want to dig through the recycling bin and rinse that yogurt cup. By telling her that I agree with her general policy, I stood a chance of escaping its mandate in this particular instance. Because knowing that I share her overall objective, she would infer that was that my high private costs of digging through the recycling that dictated against it under these special circumstances. And she would agree with me that letting this exceptional case go was the right decision.
If instead I told her I disagreed with her policy, then she would know that my unwillingness was some mix of private costs and too little weight on the social costs. Even if she internalizes my private costs she would have reason to doubt they were large enough to justify a pass on the digging and rinsing and she might just insist on it.
You are planning a nice dinner and are shopping for the necessary groceries. After having already passed the green onions you are reminded that you actually need green onions upon discovering exactly that vegetable, in a bunch, bagged, and apparently abandoned by another shopper. Do you grab the bag before you or turn around and go out of your way to select your own bunch?
- This bag was selected already, and from a weakly larger supply. It is therefore likely to be better than the best you will find there now.
- On the other hand, it was abandoned. You have to ask yourself why.
- You would worry if the typical shopper’s strategy is to select a bag at random and then only carefully inspect it later. Because then it was abandoned because of some defect.
- But this a red herring. Whatever she could see wrong with the onions you can see too. The only asymmetry of information between you and your pre-shopper is about the unchosen onions. The selection effect works unambiguoulsy in favor of the scallions-in-hand.
- You can gain information based on where the onions were abandoned.
- First of all the fact that they were abandoned somewhere other than the main pile of onions reveals that she was not rejecting these in favor of other onions. If so, since she was going back to the onion pile she would have brought these with her. Instead she probably realized that she didn’t need the onions after all. So again, no negative signal.
- If these bunched green onions were abandoned in front of the loose green onions or the leeks or ramps, then this is an even better signal. She thought these were the best among the green onions but later discovered an even better ingredient. A sign she has discerning tastes.
- It is true though that compared to a randomly selected new bunch, these have been touched by on average one additional pair of human hands.
- And also she might be trying to poison you.
- But if she was trying to poison someone, is it her optimal strategy to put the poisoned onions into a bag and abandon them in a neighboring aisle?
- In equilibrium all bunches are equally likely to be poisoned and the bagging and abandoning ploy amounts to nothing more than cheap talk.
- But, she might not be trying to poison just any old person. She might really be targeting you, the guy who wants the best bunch of onions in the store.
- Therefore these onions are either logically the best onions in the store and therefore poisoned, or they are worse than some onions back in the big pile but then those are poisoned.
- Opt for take-out.
A rundown of various tricks restaurants use when arranging items on a menu. Including The Anchor, Siberia, Boxes and Bracketing. A sampling:
4. In The Vicinity
The restaurant’s high-profit dishes tend to cluster near the anchor. Here, it’s more seafood at prices that seem comparatively modest.
5. Columns Are Killers
According to Brandon O’Dell, one of the consultants Poundstone quotes in Priceless,it’s a big mistake to list prices in a straight column. “Customers will go down and choose from the cheapest items,” he says. At least the Balthazar menu doesn’t use leader dots to connect the dish to the price; that draws the diner’s gaze right to the numbers. Consultant Gregg Rapp tells clients to “omit dollar signs, decimal points, and cents … It’s not that customers can’t check prices, but most will follow whatever subtle cues are provided.”
It was described in a novel L’ecume des Jours by Boris Vian:
For each note there’s a corresponding drink – either a wine, spirit, liqueur or fruit juice. The loud pedal puts in egg flip and the soft pedal adds ice. For soda you play a cadenza in F sharp. The quantities depend on how long a note is held – you get the sixteenth of a measure for a hemidemisemiquaver; a whole measure for a black note; and four measures for a semibreve. When you play a slow tune, then tone comes into control to prevent the amounts growing too large and the drink getting too big for a cocktail – but the alcoholic content remains unchanged. And, depending on the length of the tune, you can, if you like, vary the measures used, reducing them, say, to a hundredth in order to get a drink taking advantage of all the harmonics, by means of an adjustment on the side.
And here it is, realized:
(Porkpie pirouet: Adriana Lleras-Muney)
The first ever MD to specialize in the treatment of hangovers.
Earlier this month, he unveiled his new treatment clinic, a 45-foot-long tour bus emblazoned with soothing blue and white graphics and his business’s name, “Hangover Heaven.” Inside the bus, it looks like a cross between an ambulance and a conference room at Embassy Suites. IV drips hang from the ceiling, patients are swathed in blankets, but there are also spacious leather sofas with built-in beverage-holders and flat-screen TVs. EMTs administer relief to patients in the form of branded medical cocktails. The $90 Redemption package contains one bag of saline solution, vitamins, and an anti-nausea medication. The $150 Salvation package includes a double shot of saline solution, the vitamins, the anti-nausea medication and an anti-inflammatory as well.
They don’t take insurance. For some reason I am blanking on whom to thank for the link but I have a feeling it’s Courtney Conklin Knapp.
Skip ahead to about 13:00. It seems a little too neatly staged but it’s still hilarious.
Hardee heave: Emil Temnyalov
In the study, male fruit flies that had mated repeatedly for several days showed no preference for alcohol-spiked food. On the other hand, spurned males and those denied access to females strongly preferred food mixed with 15 percent alcohol. The researchers believed the alcohol may have satisfied the flies’ desire for physical reward.
That alcohol provides a benefit to creative processes has long been assumed by popular cul- ture, but to date has not been tested. The current experiment tested the effects of moderate alcohol intoxication on a common creative problem solving task, the Remote Associates Test (RAT). Individuals were brought to a blood alcohol content of approximately .075, and, after reaching peak intoxication, completed a battery of RAT items. Intoxicated individuals solved more RAT items, in less time, and were more likely to perceive their solutions as the result of a sudden insight. Results are interpreted from an attentional control perspective.
0.75 .075 BAC is 3 drinks an hour for someone who weighs 150lbs. In related news, here are spiders on LSD.
A question raised over dinner last week. A group of N diners are dining out and the bill is $100. In scenario A, they are splitting the check N ways, with each paying by credit card and separately entering a gratuity for their share of the check. In scenario B, one of them is paying the whole check.
In which case do you think the total gratuity will be larger? Some thoughts:
- Because of selection bias, it’s not enough to cite folk wisdom that tables who split the check tip less (as a percentage): At tables where one person pays the whole check that person is probably the one with the deepest pockets. So field data would be comparing the max versus the average. The right thought experiment is to randomly assign the check.
- Scenario B can actually be divided into two subcases. In Scenario B1, you have a single diner who pays the check (and decides the tip) but collects cash from everyone else. In Scenario B2 the server divides the bill into N separate checks and hands them to each diner separately. We can dispense with B1 because the guy paying the bill internalizes only 1/Nth of the cost of the tip so he will clearly tip more than he would in Scenario A. So we are really interested in B2.
- One force favoring larger tips in B2 is the shame of being the lowest tipper at the table. In both A and B2 a tipper is worried about shame in the eyes of the server but in B2 there are two additional sources. First, beyond being a low tipper relative to the overall population, having the server know that you are the lowest tipper among your peers is even more shameful. But even more important is shame in the eyes of your friends. You are going to have to face them tomorrow and the next day.
- On the other hand, B2 introduces a free-rider effect which has an ambiguous impact on the total tip. The misers are likely to be even more miserly (and feel even less guilty about it) when they know that others are tipping generously. On the other hand, as long as it is known that there are misers at the table, the generous tippers will react to this by being even more generous to compensate. The total effect is an increase in the empirical variance of tips, with ambiguous implications for the total.
- However I think the most important effect is a scale effect. People measure how generous they are by the percentage tip they typically leave. But the cost of being a generous tipper is the absolute level of the tip not the percentage. When the bill is large its more costly to leave a generous tip in terms of percentage. So the optimal way to maintain your self-image is to tip a large percentage when the bill is small and a smaller percentage when the bill is large. This means that tips will be larger in scenario B2.
- One thing I haven’t sorted out is what to infer from common restaurant policy of adding a gratuity for large parties. On the one hand you could say that it is evidence of the scale effect in 5. The restaurant knows that a large party means a large check and hence lower tip percentage. However it could also be that the restaurant knows that large parties are more likely to be splitting the check and then the policy would reveal that the restaurant believes that B2 has lower tips. Does anybody know if restaurants continue to add a default gratuity when the large party asks to have the check split?
- The right dataset you want to test this is the following. You want to track customers who sometimes eat alone and sometimes eat with larger groups. You want to compare the tip they leave when they eat alone to the tip they leave when part of a group. The hypothesis implied by 3 and 5 is that their tips will be increasing order in these three cases: they are paying for the whole group, they are eating alone, they are splitting the check.
(Thanks to those who commented on G+)
A famous speech from Noah S. “Soggy” Sweat, delivered on the floor of the Mississippi State Legislature, on the possible end to alcohol prohibition in that state.
My friends, I had not intended to discuss this controversial subject at this particular time. However, I want you to know that I do not shun controversy. On the contrary, I will take a stand on any issue at any time, regardless of how fraught with controversy it might be. You have asked me how I feel about whiskey. All right, here is how I feel about whiskey:
If when you say whiskey you mean the devil’s brew, the poison scourge, the bloody monster, that defiles innocence, dethrones reason, destroys the home, creates misery and poverty, yea, literally takes the bread from the mouths of little children; if you mean the evil drink that topples the Christian man and woman from the pinnacle of righteous, gracious living into the bottomless pit of degradation, and despair, and shame and helplessness, and hopelessness, then certainly I am against it.
But, if when you say whiskey you mean the oil of conversation, the philosophic wine, the ale that is consumed when good fellows get together, that puts a song in their hearts and laughter on their lips, and the warm glow of contentment in their eyes; if you mean Christmas cheer; if you mean the stimulating drink that puts the spring in the old gentleman’s step on a frosty, crispy morning; if you mean the drink which enables a man to magnify his joy, and his happiness, and to forget, if only for a little while, life’s great tragedies, and heartaches, and sorrows; if you mean that drink, the sale of which pours into our treasuries untold millions of dollars, which are used to provide tender care for our little crippled children, our blind, our deaf, our dumb, our pitiful aged and infirm; to build highways and hospitals and schools, then certainly I am for it.
This is my stand. I will not retreat from it. I will not compromise.
Alex Madrigal endorses this game:
“Don’t Be A Di*k During Meals With Friends.”
The first person to crack and look at their phone picks up the check.
Our (initial) purpose of the game was to get everyone off the phones free from twitter/fb/texting and to encourage conversations.
1) The game starts after everyone has ordered.
2) Everybody places their phone on the table face down.
3) The first person to flip over their phone loses the game.
4) Loser of the game pays for the bill.
5) If the bill comes before anyone has flipped over their phone everybody is declared a winner and pays for their own meal.
The problem with this implementation is that once one person cracks, she’s paying for the meal regardless of what happens next and so all the incentive power is gone. It’ll be a twitter/fb/texting free-for-all.
A more sophisticated approach is to make the last person who uses their phone pay for the meal. Its subtle: no matter how many people have used their phone already, everybody else has maximal incentives not to be the next one. Because by backward induction they will be the last one and instead of a free meal they will pay for everyone.
But even that has its problems because the first guy has no incentives left. So you could do something like this: At the beginning everyone is paying their own meal. The first one to use their phone has to pay also for the meal of one other person. The next person who uses their phone, including possibly if the first guy does it again, has to pay for all the meals that the previous guy had to pay for plus one more.
It would take a lot of mistakes to run out of incentives with that scheme but even if you do you can start paying for the people in the table next to you.
Barretina bump: Courtney Conklin Knapp
For those of you coming to Chicago this weekend, here is Elie Tamer’s Chicago restaurant map . Elie is your kind of foodie: very good taste, unswayed by hype. And he has been to every restaurant in the greater Chicago area, so he knows what’s good. The center of mass is slightly North of the conference cetner but there are many options close by. I asked him for some recent recommendations and he wrote to me:
all good places, but less my style:in that area there. recently been to: Ria and balsan (in the elysian hotel… really nice and $$$), girl and the goat, publican, purple pig… all good but very flashy….for out of towners, mexican here is amazing and they can try xoco(lunch sandwich)/frontera/topo there next to the AEA on clark and salpicon in old town,and mercat a la planxa (spanish inspired on south michigan) also if people are interested in steak, there are a ton there (gibsons on rush (you might run into the kardashians here it is so hip) and gene and georgettis on franklin are two examples) and of course avec is always good -really good.
I would echo his Mexican recommendations. They mostly tilt toward the high end, but you can’t go wrong. Another addition is Big Star Tacos, which Emir Kamenica recently turned me on to. Topolobampo is the best of course but good luck getting a reservation. There is the bar/cafe attached called Frontera Grill which does not take reservations but my urgent insider advice is not to go there. Especially not Saturday night around 8.
Update: Xoco/Frontera/Topo all closed through Jan 9.
During my recent unexpected visit to New York I tried to make the best of things and hit up a legendary pizza place in Brooklyn, di Fara Pizza. It’s a real hike from midtown Manhattan but I had an afternoon to kill. I was hoping it was going to brighten up an otherwise gloomy day, but guess what?
Damn you Health Inspectors!
So to make it up to myself I headed back to Manhattan for my go-to Napolitano Pizza, La Pizza Fresca in the Flatiron district. A second tragedy. The pizza guy there was a master, and now he has gone. I didn’t find this out until the pizza was before me but it was obvious immediately. Same oven, same ingredients, different pizza guy; amazing the difference between superior pizza and just average. Here’s your picture of the not-, and won’t-be-empty plate:
We had a spectacular Fall in Chicago with lots of sun and warm temperatures. Usually October is fried green tomatoes month for us, but this year after the leaves had fallen off the birch tree in our backyard they got a good couple weeks of sun and many of them ripened on the vine. Here’s your picture of empty plates:
While on the subject here’s a trick for ripening your green tomatoes when the sun won’t do it for you. Bring them inside and put then in a paper bag along with some bananas. Ethylene gas stimulates the ripening process and bananas, the champions of ripening, put out a lot of it.
We enjoyed our tomatoes with this 2004 Bordeaux, Chateau Lascombes which I must say is drinking perfectly right now.