The NY Times ran an interesting article this week about how angry restaurant owners are getting about Web sites that let diners buy and sell prime-time reservations at hot eateries.
Some of the owners apparently make vague assertions — with no concrete support — that such services make it hard to confirm reservations, lead to mix-ups concerning party size and increase the number of no-shows.
The main qualm, however, seems to be indignation that companies such as TableXchange and PrimeTimeTables would try to profit at the expense of their customers.
This strikes me as an odd objection to hear from people who themselves profit from those very same customers, but I have no idea where I stand on the ethics of selling reservations.
One the one hand, cash markets tend to insure that the people who value a scarce resource most are the ones who get it, and I can see how the sale of reservations could lead to more overall enjoyment from restaurant tables.
Imagine, for example, that my wife had subtly hinted that I’d be in big trouble if I didn’t take her to a certain restaurant for her birthday, but that I stupidly forgot to call until the fateful day. Without reservation sales, the table would go to some guy who thought further ahead but wasn’t nearly so desperate for the table. With sales, I could buy the table, save my bacon and total welfare would be increased.
One the other hand, if technology allows professional reservation scalpers to snap up seats early and extort money from the folks who would have otherwise gotten those seats for free, then diners clearly do not benefit.
Whatever the overall impact of reservation selling on diner welfare, I’m not sure why restaurant owners feel powerless to stop it.
If they are concerned with maximizing their own financial welfare, then restaurant owners should just raise prices till the demand for seats drops to meet the supply. (Actually, given that demand is different at different times, they should charge different amounts at different times by cutting prices on off nights, much as they offer “Early Bird” specials now.)
Even if restaurant owners aren’t willing to alienate customers by raising prices too badly, they could easily check the IDs as people come in the door to make sure that at least one name at every table corresponds with the name on the reservation.
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