Digitizing Disclosure: The Case of Restaurant Hygiene Scores

Weijia (Daisy)  Dai; Michael  Luca

Working Paper | HBS Working Paper Series | 2018

Digitizing Disclosure: The Case of Restaurant Hygiene Scores

by Weijia (Daisy) Dai and Michael Luca

Abstract

Collaborating with Yelp and the City of San Francisco, we revisit a canonical example of quality disclosure by evaluating—and helping to redesign—the posting of restaurant hygiene scores on Yelp.com. Implementing a difference-in-differences strategy, we find that posting restaurant hygiene scores on Yelp leads to a 12% decrease in purchase intentions for restaurants with low scores (as predefined by the City) relative to those with higher scores. We then create a “hygiene alert”—a message that appears only for restaurants identified by the City as having “poor” operating conditions with “high-risk” hygiene violations (using the same low score threshold as above)—and find a further 9% decrease in purchase intentions. Moreover, the presence of an alert reduces the restaurant’s likelihood of getting a second alert. We conclude that disclosure policy should focus not only on what information to disclose, but also on how and where to design disclosure.

Keywords: Information; Web; Quality; Safety; Food; Consumer Behavior; Outcome or Result; Food and Beverage Industry;

Language: English

Format: Print

30 pages

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Citation:

Dai, Weijia (Daisy), and Michael Luca. "Digitizing Disclosure: The Case of Restaurant Hygiene Scores." Harvard Business School Working Paper, No. 18-088, February 2018.

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Digitizing Disclosure: The Case of Restaurant Hygiene Scores

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