Digitizing Disclosure: The Case of Restaurant Hygiene Scores

30 Pages Posted: 1 Mar 2018 Last revised: 13 Aug 2018

See all articles by Daisy Dai

Daisy Dai

Lehigh University

Michael Luca

Harvard Business School

Multiple version iconThere are 2 versions of this paper

Date Written: August 2018

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. We implement a two-stage intervention that separately identifies consumer response to information disclosure and to disclosure design with improved salience. We find that posting hygiene scores on restaurants’ Yelp pages 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 low-score 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 7% 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.

Suggested Citation

Dai, Daisy and Luca, Michael, Digitizing Disclosure: The Case of Restaurant Hygiene Scores (August 2018). Harvard Business School NOM Unit Working Paper No. 18-088. Available at SSRN: https://ssrn.com/abstract=3131900 or http://dx.doi.org/10.2139/ssrn.3131900

Daisy Dai

Lehigh University ( email )

621 Taylor Street
Bethlehem, PA 18015
United States

Michael Luca (Contact Author)

Harvard Business School ( email )

Soldiers Field Road
Boston, MA 02163
United States

HOME PAGE: http://drfd.hbs.edu/fit/public/facultyInfo.do?facInfo=ovr&facId=602417

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