>> If those places raise prices to the extent that it pisses off their customers, the wait staff will suffer from reduced tips..but cheap bastards will always be cheap bastards... Don't know if you've noticed but those chain restaurants, ie Outback, Ruby Tuesday, Bonefish etc, are not exactly cheap.....
As usual, you have no idea.
We reviewed 160 studies on the price elasticity of demand for major food categories to assess mean elasticities by food category and variations in estimates by study design. Price elasticities for foods and nonalcoholic beverages ranged from 0.27 to 0.81 (absolute values), with food away from home, soft drinks, juice, and meats being most responsive to price changes (0.7–0.8). As an example, a 10% increase in soft drink prices should reduce consumption by 8% to 10%.
http://www.ncbi.nlm.nih.gov/pmc/articles/PMC2804646/
So, contrary to your post, food prices generally, but particularly FAST food prices, have elasticities such that they are among the "most responsive to price changes".
Thus, if you increase the prices of fast food, people buy less, which means, of course, fewer employees are needed and once again yours and CJ's claims are totally disproved.
I'd think you two would give up. |
