Does Yelp Affect Restaurant Demand?

Anderson, M.L. and J. Magruder.

from ARE Update Vol. 16, No. 5, May/Jun, 2013

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Abstract

Internet review forums increasingly supplement expert opinion and social networks in informing consumers about product quality. We estimate the effect of positive Yelp.com ratings on restaurant reservation availability and find that an extra half-star rating causes restaurants to sell out 19 percentage points (49%) more frequently, with larger impacts when alternate information is more scarce.

Keywords

Crowd-sourced information, Social media, Internet ratings, restaurant reviews

Citation

Anderson, M.L. and J. Magruder. "Does Yelp Affect Restaurant Demand?" ARE Update 16(5)(2013):1-4. University of California Giannini Foundation of Agricultural Economics.
http://giannini.ucop.edu/publications/are-update/issues/2013/16/5/does-yelp-affect/