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Norms, moods, and free lunch: Longitudinal evidence on payments from a Pay-What-You-Want restaurant

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  • Riener, Gerhard
  • Traxler, Christian

Abstract

We study the distribution and evolution of payments in a Pay-What-You-Want restaurant. Despite missing price tags and despite the option to pay nothing at all, we observe that the vast majority of guests makes strictly positive payments. Over the two years covered by our data, average payments decline slightly, converging at a positive level. At the same time, the number of daily guests increases steadily, resulting in a considerable increase in total revenues. We discuss one possible interpretation of the long-term trend in payments in terms of social norms. We further show that short-term fluctuations in average payments are partly explained by exogenous weather changes. We provide evidence that – in line with work in psychology – weather-induced changes in mood affect payments.

Suggested Citation

  • Riener, Gerhard & Traxler, Christian, 2012. "Norms, moods, and free lunch: Longitudinal evidence on payments from a Pay-What-You-Want restaurant," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 41(4), pages 476-483.
    • Handle: RePEc:eee:soceco:v:41:y:2012:i:4:p:476-483
    DOI: 10.1016/j.socec.2011.07.003
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    References listed on IDEAS

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    More about this item

    Keywords

    Pay-What-You-Want; Moods; Weather; Social norms;
    All these keywords.

    JEL classification:

    • Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Language; Social and Economic Stratification
    • D49 - Microeconomics - - Market Structure, Pricing, and Design - - - Other

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