New Yorkers generally like to keep their cool, but they’ve lost it over the NYC Hospitality Alliance insinuating that the city might crack down on bottomless brunch—which, it turns out, is illegal. “This might be your final weekend for happiness,” warns Jezebel. “Bottomless brunch is technically illegal. See you in jail,” tweeted New York magazine.
The communal freak-out is probably unwarranted, seeing as the law isn’t new and the Hospitality Alliance has no law-enforcement power. But what if the unthinkable happens, and unlimited mimosas go the way of smoking inside and keeping ferrets as pets?
Research shows New Yorkers might not be losing as much as they think: Paying for an all-you-can-eat or –drink meal might mean feeling obligated to eat and drink beyond your stomach’s means—even if you’re not enjoying it. For a 2011 article in the Review of Economics and Statistics, “The Flat-Rate Pricing Paradox: Conflicting Effects of ‘All-You-Can-Eat’ Buffet Pricing," Cornell economists David Just and Brian Wansink carried out a field experiment on diners paying a flat rate for lunch. Just and Wansink recruited 66 people who were on their way to an all-you-can-eat restaurant serving a pizza buffet. They let half the participants pay the regular price, $5.98, for the buffet, while they gave half their subjects a coupon for 50 percent off. Unbeknownst to the diners, their pizza intake was then monitored by their waiters and later analyzed by Just and Wansink.
Just and Wansink discovered an unexpected correlation between price and consumption. “Because a customer faces no marginal cost to consumption,” they wrote, “Conventional utility maximization implies that he or she should continue to eat until the marginal utility of consumption reaches 0. Economic models of consumer behavior commonly assume that utility of consumption is unaffected by the price paid.” But the two groups were consistently eating different amounts of pizza, with people who paid full-price eating, on average, 31.77 percent more than the group that paid half (4.1 slices versus 2.9). Just and Wansink say this illustrates the “sunk cost fallacy”: Although the money’s already been spent—the cost is “sunk”—consumers are irrationally trying to “make up” the sunk cost. (Presumably, the group that didn’t get a discount wasn’t just extra-hungry.)
And when Just and Wansink surveyed customers after their meals on how much they’d enjoyed their pizza, they discovered a negative correlation between taste and consumption: The more pizza people ate, the less they enjoyed it. Bottomless brunch suddenly sounds a lot less appealing.
Image via Shutterstock.