RESTAURANTS

An economic history of restaurants

And how the pandemic may change them
Apr 28th 2022 ECONOMIST 

April 9th 2020 was the restaurant industry’s darkest day. The imposition of lockdowns to slow the spread of covid-19, combined with people voluntarily avoiding others, meant that on that Thursday bookings in America, Australia, Britain, Canada, Germany, Ireland and Mexico via OpenTable, a restaurant-reservation website, normally in their millions, fell to zero. Now, as economies unlock, many restaurants, even the fanciest, are facing labour shortages. Le Gavroche, one of London’s swankiest French offerings, has had to stop its lunch service and has lost its general manager.

Covid brought to a halt an astonishing expansion. In 2010-19 the number of licensed restaurants in Britain grew by 26%. Americans were, for the first time, spending more than half their total food budget on eating out. Well-paid folk from Hong Kong to Los Angeles were happily renting kitchenless apartments: why bother cooking when good food was so lavishly available beyond your front door?

Being deprived of restaurants has made people realize how much they value them. Eating out fulfills needs that seem fundamental to human nature. People need to date, seal deals and peer at their fellow humans. At a good restaurant, you can travel without traveling, or simply feel coddled.

Yet restaurants in their current form are a few hundred years old at most. They do not satisfy some primeval urge, but rather those of particular sorts of societies. Economic and social forces, from political reform to urbanisation to changing labour markets, have created both the supply of and demand for restaurants. Their history also hints at what their future could look like in a post-pandemic world.

People have long feasted outside the home. Archaeologists have counted 158 snack bars in Pompeii, a city destroyed by a volcano in 79ad—one for every 60-100 people, a higher ratio than many global cities today. Ready-cooked meat, game and fish were available for Londoners to eat from at least the 1170s. Samuel Cole, an early settler, opened what is considered to be the first American tavern in 1634, in Boston.

These were more like takeaways, though, or stands where food might be thrown in with a drink, than restaurants. The table d’hôte, which appeared in France around Cole’s time, most closely resembled a modern restaurant. Clients sat at a single table and ate what they were given (trends now making a comeback). Many of these proto-restaurants resembled community kitchens, or quasi-charities, which existed for the benefit of locals. Strangers were not always welcome.

Nor were they destinations predominantly for the well-heeled. Before the use of coal became widespread in England in the 17th century, preparing food at home involved spending a lot on wood or peat. Professional kitchens, by contrast, benefited from economies of scale in energy consumption and so could provide meals at a lower cost than people could themselves. Today dining out is seen as an indulgence, but it was the cheapest way to eat for most of human history.

It was, thus, a low-status activity. Cicero and Horace reckoned that a visitor to a bar might as well have visited a brothel. According to “Piers Plowman”, a late-14th-century poem, cooks would “poison the people privily and oft”. Some rich types rented private dining rooms; Samuel Pepys, a 17th-century diarist, enjoyed eating “in the French style” (that is, with communal dishes) at one in London. But most wealthy people preferred to eat at home, enjoying the luxury of having staff to cook and clean up.

Over time, however, the notion that a respectable person might eat a meal in public gradually took hold. Wilton’s, a fish restaurant in London, got going in 1742. Dublin’s oldest, established in 1775, traded under the name of the “Three Blackbirds” and was “noted for a good bottle of Madeira, as well as for a Chop from the Charcoal Grill”. Fraunces Tavern, New York City’s oldest restaurant, probably opened in 1762 (it is still open today and serves determinedly American fare from clam chowder to New York prime strip steaks).

Some historians look to the supply side to explain this shift, arguing that the restaurant emerged as a result of improvements in competition policy. Powerful guilds often made it hard for a business to sell two different products simultaneously. Butchers monopolised the sale of meat; vintners that of wine. The growth of the restaurant, which serves many different things, required breaking down these barriers to trade.

A Monsieur Boulanger, a soup-maker in Paris, may have been the first to do so. He dared sell a dish of “sheep’s feet in white-wine sauce”. The city’s traiteurs (caterers) claimed the dish contained a ragout, a meat dish only they were allowed to prepare, and was therefore illegal. They took their case to court, but Boulanger triumphed. The tale, supposedly marking the beginning of a movement in mid-18th-century France towards more open markets, is probably apocryphal. But other regulatory changes did help. In Britain reformers worried about public drunkenness passed a law in 1860 allowing places serving food to serve wine as well (thus encouraging people to eat something to sop up the booze). Around the same time American states started passing food-safety laws, giving customers more confidence in the quality of the food.

Yet for restaurants to flourish, richer people had to demand what Pepys did not: eating in full view of others. Until the 18th century elites largely viewed public spaces as dirty and dangerous, or as an arena of spectacle. But as capitalism took off, public spaces became sites of rational dialogue which were (putatively) open to all. And, as Charles Baudelaire, a French poet, observed, 19th-century cities also became places where people indulged in conspicuous consumption.

The restaurant was the natural habitat of the flâneur, Baudelaire’s wandering observer of city life. Where better than a restaurant to see and be seen? Out went the set menu of the table d’hôte; in came the à la carte kind. Shared tables gave way to private ones. Eating out became less of a communal activity focused on calorie intake and more of a cultural experience—and a place, as Baudelaire wrote, where people could show off their wealth by ordering more food than they could eat and drinking more than they needed.

Restaurants’ growth accelerated in the 20th century. American employment in food service quadrupled as a share of the workforce over this period. The Michelin Guide was first published in 1900; the stars came 26 years later. And yet the continued rise of the restaurant up until the pandemic nonetheless presents an economic puzzle. Cooking at home was becoming ever easier. Average house sizes grew. Appliances such as the food processor and the dishwasher reduced preparation and clean-up times. Dining out became relatively more expensive: in America in 1930 a restaurant meal was 25% costlier than an equivalent meal at home, but by 2014 the gap had risen to 280%. From 2007-20 “French Laundry inflation”, describing the cost of a meal at a three-Michelin-star restaurant in California, was twice the core inflation rate.

And yet three economic changes ensured that demand for restaurants grew despite rising prices. The first is immigration. In the 50 years after the second world war the net flow of migrants into rich countries, relative to population, more than quadrupled. Starting a restaurant is a good career move for new arrivals; it neither requires formal qualifications nor, at least for chefs, fluency in the local language. Migrants tend to improve the quality of an area’s restaurants. London’s became far better in the era of free movement with the European Union. The melting pot that is Singapore has some of the best food in the world. Restaurants became more tempting, even as prices went up.

The second factor was the changing microeconomics of the family. As a new paper by Rachel Griffith of the Institute for Fiscal Studies, a think-tank, and colleagues, shows, households’ choices about whether to make their own food or to buy it premade are shaped not only by the upfront cost of those things. They also depend on what economists call “shadow costs”.

The true cost of an at-home meal involves not just the outlay for the ingredients, but the time spent on shopping and preparation. In an era of low female labour-force participation, shadow costs were low. A stay-at-home mother who cooked instead of eating out would have less leisure time. But as more women entered the workforce during the 20th century this equation changed, raising the shadow cost of cooking. Now a working woman who cooked dinner would be sacrificing time which might otherwise be used to earn money. And so eating out made increasing economic sense, even as it became more expensive.

The third factor was changing working patterns. Historically poor people have tended to work longer hours than rich ones. But in the latter half of the 20th century the opposite became true. The rise of knowledge-intensive jobs, and globalisation, made rich people’s work more financially rewarding—and enjoyable. Toiling into the night became a sign of status. The upshot was that the people with the most money to spend on dining out increasingly needed it most, since they had the least free time. In Britain the richest tenth of households devote a much bigger chunk of their overall spending to dining and drinking out than the poorest tenth, and the gap has grown in recent years.

What does the history of the restaurant say about its future? People have relished their reopening. In recent weeks global restaurant reservations have been near their pre-pandemic levels. The best ones are booked up for months: Silicon Valley nerds have created automated bots which instantly reserve tables.

The long-term future of the restaurant is less clear. The pandemic has led to many people buying more takeout than before (Uber’s revenue from delivery now exceeds what it earns from helping people get around), while others have a newfound love of cooking. Restaurants have little choice but to continue to adapt. That means moving still further from the utilitarian model of the 18th century and before, and instead doubling down on what they do best: offering those who need to eat a taste of romance, glamour and love. 

About admin

I would like to think of myself as a full time traveler. I have been retired since 2006 and in that time have traveled every winter for four to seven months. The months that I am "home", are often also spent on the road, hiking or kayaking. I hope to present a website that describes my travel along with my hiking and sea kayaking experiences.
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