Thursday, March 02, 2006

Waiters and restaurant hygiene

During my work-period, I had only three places to go for lunch: Subway, Shefali or the Street-hawker. Shefali was the middle-range and hence I frequented it the most. And I could sense the hatred in the waiter for me (or us) when we entered during peak lunch time, garnered 10 chairs and ordered 2 chow-meins and one Coke. Both of us had little choice. He couldn't throw me out and I couldn't abandon Shefali. You can do a market analysis of insufficient restaurant competiton but I will reserve that for later.

Pissing off waiters has its costs as they may piss into your dish as shown in Fightclub. You should see the movie for its take on consumerism among other issues. Sample a one-liner. The things you own end up owning you! But if you really want to know what it means to be on the other side of the table you should peruse Waiting: The True Confessions of a Waitress and Hey, Waitress! The USA from the Other Side of the Tray.

Anyways, one question for policy making is how to impact restaurant/ hotel hygiene. One of my previous research studies did involve health inspections in Delhi for shops and restaurants. You can view a sample photograph and rule here. It took us umpteen efforts to dig out the rule book from the Municipal Corporation of Delhi. You are guaranteed to see the hygiene world (or lack of it) in Delhi in a new light once you read those rules. The obvious question that strikes is, these are probably good rules! We should only make sure that they get implemented. I am disinclined to believe in that approach for reasons of experience and theory. There are vast problems of incentives with depending only on a "bull-dozer" inspection approach to hygiene.

Unless the information of hygiene reaches the consumer, there is little good incentive for the producer to supply better hygiene or the consumer to sift or demand better hygiene. Hence a better approach would be to use the power of information to have efforts for better hygiene. Again, not all improvements in hygiene are cost-beneficial to the producer or the consumer. You set too high a standard for hygiene and pretty soon all street-food will disappear. Ask yourself who will suffer the most?

Display of inspection scores would be a good way out of the dilemma. It forces competition among restaurants for better hygiene or let their prices reflect the lower hygiene. On the other hand, it forces inspectors to have objective criteria for the scores. It still is a surprise for me as in why there isn't a rating market for hygiene criteria (among other things) of restaurants. You cna extend that to performance of schools in metro cities as well. Market failure or the government crowding out private initiative? There are guidebooks for rating food taste and variety but not quality as of yet. But the government could kickstart the process of having inspections scores or grades displayed prominently in the windows of restaurants. Even if not honest at the outset, transparency of scores can force better delivery of hygiene in the long run. Read The Effect Of Information On Product Quality: Evidence From Restaurant Hygiene Grade Cards by Ginger Zhe Jin and Phillip Leslie for the above proposed reform in the context of Los Angeles County, USA.

The abstract is stated below.

This study examines the effect of an increase in product quality information to consumers on firms’ choices of product quality. In 1998, Los Angeles County introduced hygiene quality grade cards to be displayed in restaurant windows. We show that the grade cards cause (i) restaurant health inspection scores to increase, (ii) consumer demand to become sensitive to changes in restaurants’ hygiene quality, and (iii) the number of food borne illness hospitalizations to decrease. We also provide evidence that this improvement in health outcomes is not fully explained by consumers substituting from poor hygiene restaurants to good hygiene restaurants. These results imply the grade cards cause restaurants to make hygiene quality improvements.

The classic quote that I heard from an inspector on the quality of restaurant food when they are not inspecting was, "Bhai, hamara tho 9-5 job hai!" Ours is a 9 -to-5 job!

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