“Creamed” during the pandemic, the buffet had everything we wanted to avoid. Just the thought of spooning food from a shared platter made most of us cringe.
No more
The buffet is back.
An economist can explain why.
Buffet Economics
Called a wonderland of gluttony, the buffet has returned for the budget conscious and those of us who will spend more. Whether it’s $20 at the Golden Corral chain or $100+ at the Las Vegas Bellagio, the demand and supply incentives are the same at the buffet.
On the demand side, food writers say we appreciate the value, the choice, and the consistency. In addition, buffets present Instagrammers and TikTokkers with unlimited creativity. Yes, there are always the stories of the “vacuum cleaners” that ate five portions of steak and the woman that consumed all of Golden Corral’s brownies, but most diners are “average eaters.”
Meanwhile, for supply, we are looking at economies of scale. Chefs cook large batches at one time and self-service is the rule. In a traditional sit down restaurant one chef services 25 people an hour while for a buffet, it’s 200. Although they require more food, buffets save on labor:
As a result, remembering behavioral economics, buffets position the pasta and potatoes first. They also use smaller plates:
Our Bottom Line: Marginal Utility
As economists, whether looking at buffet demand or supply, we should remember economist Alfred Marshall (1842-1924). A professor at Bristol and Cambridge, he was the scholar who encouraged us to think at the margin. Defined as where we decide if we want something extra, the margin is the place we make most decisions. Marshall saw that extras matter because their value varies. We decide whether to hire an extra worker by comparing the extra revenue to the extra wage. When we consider sleeping an extra 15 minutes, we think of the marginal benefit (the pleasure) and the marginal cost (no time for breakfast).
Buffets are all about the margin. As both sides constantly contemplate how much extra, they are dealing with all-you-can-eat. Whereas every extra costs the restaurant money, on the demand side also, the extras start having an increasing cost. Called diminishing marginal utility, the pleasure of each extra unit of consumption tends to decrease. All of us know that we get much more joy from the first slice of pizza than the 10th.
So, whether, it’s supply or demand, buffet economics is always at the margin.
My sources and more: Seeing the NY Times food section headline the buffet, I knew it was time to return to it. Then, for buffet economics, the Hustle newsletter came in handy.
