Archive for the ‘Food and wine’ Category

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Othman on Pickens, Horseflesh, and Hypocrisy

August 11, 2010

Michael Giberson

Abe Othman at Constructive Economics has been reading Boone Pickens:

T. Boone Pickens, from his autobiography The Luckiest Guy in the World:

I believe the greatest opportunity lies in a free marketplace. There are powerful forces afoot trying to restrict that freedom in the interests of the vested and already wealthy.

T. Boone Pickens, in congressional testimony on a bill to prevent the slaughter of horses for food:

The whole thing, it’s a boondoggle on the American people…People that are for the slaughter should be forced to go down on that kill floor…The brutal slaughter of horses for consumption by wealthy diners in Europe and Japan cuts against our moral and cultural fiber — it’s just plain un-American.

Othman remarks, “Remember, if they can come after the horse slaughterers, they can come after the hedge funds.”

(Othman apparently remains under the the influence of Al Roth’s work on repugnance and markets – not that there is anything wrong with that.)

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Dynamic pricing for foodies … and for electricity?

May 10, 2010

Lynne Kiesling

If you like to cook and to eat well in Chicago, you can’t avoid chef Grant Achatz (nor should you want to!). His signature restaurant, Alinea, was recently named the best restaurant in the U.S. and one of the best restaurants in the world, and he is a creative, if controversial, innovator of “molecular gastronomy”.

Achatz, with business partner Nick Kokonas, got the foodie chatterati talking again last week when they announced their new venture, a Chicago restaurant called Next. Next has two novel features: the menu will change every few months and will channel the food and atmosphere of a particular time and place, and the pricing is prix fixe along the lines of a concert ticket. The first time-place that they will feature is Paris 1912, the tail end of the Belle Epoque (one of my favorite artistic and culinary periods!).

The pricing of the experience as a prepaid prix fixe is interesting in and of itself, and other economists have commented on that since the announcement. But the feature that is likely to be of the most interest to KP readers is outlined on the restaurant’s FAQ:

How much?
A meal at Next will represent a great value. Depending on the menu AND what day and time you are dining, food will be $40 to $75 for the entire prix fixe menu. Wine and beverage pairings will begin at a $25 supplement. Next’s goal is to serve 4-star food at 3-star prices.

Tickets?
Yes. Instead of reservations our bookings will be made more like a theater or a sporting event. Your tickets will be fully inclusive of all charges, including service. Ticket price will depend on which seating you buy – Saturday at 8 PM will be more expensive than Wednesday at 9:30 PM. This will allow us to offer an amazing experience at a very reasonable price. We will also offer an annual subscription to all four menus at a discount with preferred seating.
Two walk-in tables will be available every evening.
The tickets will be available via our website, and we are building the reservation system from scratch to ensure the best customer experience. It will be simple to use, efficient, and familiar to anyone who has booked a show or travel online.

This is a pricing system for the foodie economist! Selling tickets in advance signals popularity to the seller, gives the seller more certainty about the number of customers and the amount they will sell, and enables them to optimize their purchases of inputs. They need only procure extra for the two walk-in tables, plus a cushion for mistakes and accidents. That’s one reason why they can expect to deliver “4-star food at 3-star prices”.

But the pricing feature about which I will rhapsodize is, of course, the dynamic pricing: “Saturday at 8 PM will be more expensive than Wednesday at 9:30 PM”. This price discrimination is brilliant but not novel, although its use in restaurant pricing is. It is a decentralized mechanism that enables consumers to sort themselves according to their their willingness to pay, their preferences and their price elasticity of demand while simultaneously enabling the seller to maximize revenue. Combined with the “concert ticket” design, this pricing structure generally looks like a good setup for profit maximization. And given what has driven Achatz’s popularity and the fact that the time-place “Paris 1912″ idea is more like entertainment than any dining experience I know of other than Medieval Times, I think the price discrimination is also a valuable way to allocate dining spaces over which there will probably be excess demand.

Given this innovation in an improbable industry, here’s my challenge to those of you who work in the electricity industry, in electricity policy, or electricity regulation: if a creative innovator can create so much new value for consumers in such an improbable industry by adopting such a contractual form and such a pricing system, why do you reject it so strenuously in electricity? The parallels are striking — potential restaurant customers have a range of preferences, incomes, willingness to pay. We all need to eat. Restaurants have high fixed costs (although of course not in the proportion that we see in infrastructure industries). Customers like me relish the thought of such a choice, and look forward to its availability. Why do you make so many customers worse off relative to the potential value they could achieve from innovation if you removed the barriers to innovation, product differentiation, and competitive choice in retail electricity markets?

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Jamie Oliver, children and food, and field experiments

February 25, 2010

Lynne Kiesling

Several years ago Jamie Oliver set out to improve school food for a group of British children. In part he was motivated by wanting to impart a love of good, healthy food in children by sharing his own joy in food, and in part he believed that healthier school meals would lead to less obesity and better academic performance. As Tim Harford noted in his Undercover Economist column in November:

Oliver’s mission to persuade schools to serve healthier lunches – and get children to eat them, and stubborn mothers not to stuff chips through the school railings – became a national phenomenon in 2005. Tony Blair and David Cameron fell over themselves to jump on the Naked Chef’s bandwagon, and soon everyone in the country had an opinion on the campaign.

Harford then discusses a working paper by Michèle Belot and Jonathan James that uses Jamie Oliver’s school lunch work as a field experiment; from Belot’s web site:

“Healthy School meals and Educational Achievements”, with Jonathan James

Children’s diet is a major source of preoccupation in many developed countries. The concerns have mainly been focused on the implications for obesity and health outcomes. However, the effects of children’s poor diet may extend beyond health; food is an obvious input in the “learning production function” and deficiencies in diet may result in important deficiencies in nutrients playing an essential role in cognitive development. This study exploits a unique experiment in the UK, the “Feed Me Better Campaign” where the meals served in the 81 schools of one area (Greenwich) were changed drastically by the British Chef Jamie Oliver. Because the campaign was literally designed as a large-scale experiment, it offers a unique opportunity to assess the causal effects of healthier food on educational outcomes. We find that educational outcomes did improve in Englsih [sic] and Science, although we cannot rule out small effects. We also find that the campaign reduced absenteeism by 15% .

A well-designed field experiment in economic policy is hard to achieve, particularly because to get a representative distribution among treatments you have to randomize who participates in what treatment, which is politically difficult (I can tell you stories about this in electricity, but it will require a cocktail). This experiment does not randomize, but it does provide a large-scale test with comparative demographics that minimize the selection bias problem. As Harford notes,

The chef had convinced Greenwich’s council and schools to change menus to fit his scheme; he mobilised resources, provided equipment and trained dinner ladies. Other London boroughs with similar demographics received none of these advantages – and indeed, because the programme wasn’t broadcast until after the project was well under way, probably knew little about it. The result was a credible pilot project. It wasn’t quite up to the gold standard of a randomised trial, but it wasn’t far off. …

… Surely what counts is that a new idea was tried out on a respectable scale, and now we have a chance to figure out whether it worked. What astonishes me is that it took a television company and a celebrity chef to carry out a proper policy experiment.

Oliver’s work has led to his receiving a TED Prize for 2010, drawing attention to his work to improve diet, food knowledge and understanding, and cooking for children, focusing on the UK and US. His TED address from a couple of weeks ago is well worth a listen; he does go a bit histrionic for my taste in some parts of it, but his passion for incorporating knowledge about food into education is obvious. And, he knows how to design a policy experiment.

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Weekend cooking

February 14, 2010

Lynne Kiesling

We did a lot of cooking this weekend, including taking advantage of my Christmas holiday baking — I made double batches of pie dough and pizza dough and froze half of what I made for later. I had also frozen some Michigan tart cherries from the farmer’s market last June, so the mid-February treat was pizza and cherry pie, YUM! Here’s what a cooking weekend chez KP looks like:

The KP Spouse is a master pizza chef, and this was a delicious one — onions, garlic, olives, red peppers, coppa ham, fresh mozzarella. Life is good.

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A disgusting display of bureaucratic force from the Chicago Department of Public Health

February 5, 2010

Lynne Kiesling

This is so vile, so disgusting that I am literally nauseated at my desk as I write. One of the ways that independent chefs, caterers and confectioners economize on their substantial fixed costs is by sharing kitchens. In Chicago, the business license treatment of such kitchens from the Chicago Department of Public Health has been uncertain: does the kitchen owner have to be the one with the license, or does each user of the kitchen have to have a separate license?

Last night, due to a paperwork miscommunication and Kafkaesque bureaucratic process of trying to sort this out, the Chicago Department of Public Health destroyed organic fruit purées that Flora Lazar of Flora’s Confections prepared over the summer and preserved to use in her much-touted and anticipated Valentine’s Day confections. These officials tore open the bags and bleached the food so that it could not be put to any use. I’m going to quote Chicago Tribune reporter Monica Eng here at length, because she was there, and her post illustrates exactly how senseless and appalling this destructive CDPH behavior is, but there is more at her post, including a depressing video of the CDPH officials destroying the food, so please do go read more there.

In a sad struggle that unfolded in a West Town kitchen Thursday night, Department of Health inspectors seized, slashed open and poured bleach over thousands of dollars of local peaches, pears, raspberry and plum purees owned by pastry chef Flora Lazar. She’d purchased the fruit from Green City Market farmers last summer and had planned to use it to make local fruit gelees for her business, Flora Confections.

More than $1,000 of food owned by the Sunday Dinner Club caterers was also destroyed by health department inspectors.

Inspectors cited no health problems with any of the food. They even encouraged Lazar’s son to eat the confiscated granola bars from Sunday Dinner Club. They only said the food was prepared by chefs who didn’t have the proper business licenses to prepare and sell it. …

The destruction of organic artisanal granola bars and local fruit from Klug Farm and Hillside Orchards is heartbreaking to any local food advocate. But for Flora Lazar, this setback, the week before Valentine’s Day is devastating.

“This puts me out of business for six months,” a despondent Lazar said. “I have done everything by the rules. Instead of making the food at home, which I could easily do, I sought out and rented space in a licensed kitchen. When they finally said we could apply for a separate license, I did that. I paid my $600 and invited the inspectors here today.”

If Lazar had been less transparent and left her cooler in her car during the inspection, she would probably be cooking today. Inspectors were mostly destroying food that had been prepared before their arrival. But she estimates that her honesty and attempt play by the rules just cost her $6,000 in revenue. She says the fruit purees, harvested at the peak of Midwest ripeness, are “irreplaceable.” …

But until recently the city had no clear policy regarding shared use kitchens, says Kitchen Chicago owner Alexis Levering. When she secured her latest space she said she confirmed with the Department of Licensing that it was zoned for shared use. The department further assured her that as the licenseholder, she would be responsible for any food safety issues associated with her clients, she says.

Later, though, Licensing said her clients would all need to apply for their own licenses, and with each application they’d need to get a new health inspection, giving the little niche kitchen exponentially more inspections than the busiest restaurants in Chicago.

But when Kitchen Chicago users went to the department, they were told again that they couldn’t apply for the license because it was at the same address as Levering’s license. The confusion continued for months until recently, Levering said, a department representative told her that now he would make sure that renters could apply for the licenses. He further told her, however, that any violations committed by one chef would mean a ticket for every cook who rents space in the facility, meaning possibly thousands of dollars reaped by the city for a minor infraction by one cook the others might have never met.

“That’s like giving everyone in the car their own ticket when a driver is stopped by the police,” she said.

This week, it seemed as if the kitchen was finally making progress with the department and, indeed, two of the businesses, Sunday Dinner Club and Flora Confections, had their license applications accepted, paid their fees and were told the inspectors would come Thursday.

The inspectors arrived at 9:30 a.m. and didn’t leave until nearly 5 p.m., when their final act was to destroy hundreds of pounds of local, organic, often unopened cheese, cassoulets, granola bars, frozen fruit purees, baking ingredients and more with a gallon of bleach.

Officials never said that the food posed a health risk. At best it was a victim of paper work confusion among city bureaucrats who couldn’t agree on a policy. But since no one at the city will comment on the situation, part of the story remains unclear.

Francis Guichard who is the CDPH food protection director called this morning to say that her inspectors could not allow the food to move from the building because they could not ensure where it was going. Licensing has still not commented on the issue.

At one point, one of the cooks suggested that the unopened food at least go to the Greater Chicago Food Depository rather than being destroyed. That request was denied. Watching the destruction of all of this perfectly edible food, you’d never know we live in a state where one out of 10 households doesn’t have enough food to eat.

The Health Department inspectors are expected back at the kitchen today to destroy the rest of the food they deem unlicensed.

These so-called “protectors of public health” destroy the inputs into an entrepreneur’s business in her busiest season, despite acknowledging that the destroyed food poses no health risk. These so-called “protectors of public health” destroy perfectly healthy food instead of even giving to hungry, needy people. On what grounds can these so-called protectors of public health have any legitimate claim to be doing valuable work on behalf of the people of Chicago? And I pay how many thousands of dollars in taxes every year to support this kind of wasteful, counter-productive, aggressive, megalomaniacal activity?

If these City of Chicago employees are indicative (and I think they are) of the attitude of city government toward entrepreneurship and toward the value of meaningless bureaucratic gestures that keep income out of the pockets of entrepreneurs and food out of the mouths of people, then I am truly ashamed and embarrassed to call this my home. It adds insult to injury that I pay such high taxes for the privilege of living in such a despotic city. Yes, I mean despotic; we Chicagoans know that there are many dimensions in which such a word is not hyperbole.

I also sympathize with the first commenter on Monica’s post:

And the Government still doesn’t think the Revolution is coming?

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A little innovation with great effect: the new Heinz ketchup packet!

February 5, 2010

Lynne Kiesling

Here’s an example of how a small innovation can have a substantial beneficial impact: Heinz redesigns its ketchup packets to hold three times as much ketchup, and to be squeezed or dipped. No more ketchup splurts on clothes, no more having to get three packets to get as much as you’d like, no more having to open the ketchup for your kids. And, of course, as a Pittsburgher I am doubly proud of this redesign.

Seriously. It’s little innovations like this, and like my other favorite example, the non-drip top on laundry detergent bottles, that bubble up from the market and, in aggregate, are great evidence for the plenitude of free enterprise.

The new packet is also cute, which doesn’t hurt …

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Hey cooks! Use Bing for recipe searches

January 25, 2010

Lynne Kiesling

OK, so this is pretty cool and useful:

Today Bing, the relatively new search engine from Microsoft, launched a feature that lists recipes when users search for food items. Search “chicken,” for example, then click the “chicken recipes” tab, and Bing delivers chicken noodle soups and chicken schnitzels from major databases like Allrecipes, Delish, and bonappetit.com’s sister site, Epicurious.

The searches will also include calorie counts, photos, etc. Pretty nifty! And the competing search engine thing is very good too …

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How to cook perfect roast potatoes

January 13, 2010

Lynne Kiesling

I cooked up a storm over the holidays — homemade pizza dough, cookies, pear clafoutis, New Year’s Day pork roast and spaetzle (but no sauerkraut), waffles, pancakes, beef barley soup (with homemade beef stock, YUM), it just went on and on and on. And it all turned out better than usual, because for once I slowed down, gave myself time to do it right, and focused on the simple pleasure of doing one enjoyable thing at a time and allowing myself to be entirely absorbed in it.

In part I interpret all of the focused, purposeful, yet slow-paced culinary immersion as a consumption good — I really do enjoy cooking very much. In part, though, I also think of it as part of my deliberate effort over the holidays to, as Jonah Lehrer described in his Wall Street Journal article on why most of our New Year’s resolutions fail, allow my prefrontal cortex some rest and relaxation time.

The biggest payoff of this activity came with Christmas dinner. The menu: beef-a standing rib roast, individual Yorkshire puddings, roast potatoes, and roast green beans with garlic. Our friend Sam and her mom joined us, contributing their conviviality and two delicious desserts. It was one of those rare meals in which every dish turned out well — the roast was done enough but not too done, the Yorkshire puddings puffed delightfully and looked like little chef’s hats (and tasted good too).

But for my part the best culinary discovery of the savory dishes in this meal was the roast potatoes. I am a great fan of the potato, so I am no stranger to roasting potatoes (although in the domestic specialization and exchange, the KP Spouse usually does the roasting, and typically on the grill). But the Christmas potatoes were a revelation — crunchy and flavorful on the outside, creamy and mellow on the inside. How did this happen?

I credit the British cook and domestic diva Nigella Lawson. In flipping through her book How To Eat to see how she cooks her rib roasts, I ran across her recipe for roast potatoes. She recommended doing three things that I had never tried before:

  1. Parboil the cut potatoes in salted water for 5 minutes
  2. Drain the potatoes, put a lid on the pot, and shake the pot vigorously to soften the parboiled potatoes and make their edges slightly mushy
  3. Toss the potatoes with 1 tablespoon of semolina flour before putting them in a roasting pan with (olive) oil that has been preheating (if you don’t have semolina you can use all-purpose flour instead)

The result was WOW. I’ll never be able to go back to doing them any other way. Give it a try and let me know what you find!

Coincidentally, today I got some validation from one of my favorite cooks-cookbook authors-food bloggers, Clotilde Dusoulier at Chocolate & Zucchini. Her post today describes the technique (and recipe) for her friend Pascale’s roast potatoes, and the “shake the pan” technique features prominently:

Pascale’s roasted potato magic unfolds thusly: the potatoes are parboiled for five minutes first, drained, and returned to the saucepan. At this point — and this is the crucial step, so pay attention — you grab the lidded pan and shake it vigorously, which not only is fun, but also serves to make the surface of the potato pieces fuzzy from rubbing their hips one against the other.

And wouldn’t you know it, it is this very fuzz that fosters the formation of a splendid crust when you then bake the potatoes, while the parboiling step reduces the baking time and ensures that the flesh inside stays moist.

Apparently her friend learned this technique from her British mother-in-law, so we have two data points here that suggest to me that the British know a thing or two about how to make great roast potatoes. I’d bet cooking them in goose fat wouldn’t taste too awful either …

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Rooftop honey in Chicago

December 6, 2009

Lynne Kiesling

The Marriott hotel on Michigan Avenue has been harvesting honey from beehives they have set up on their own roof. They use the honey in an on-site microbrew beer and in some of the dishes they make in their restaurant. What do you think are some of the economic motives driving such a decision? Is on-premise honey sufficiently esoterically gourmet to be that compelling to consumers?

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Tea online: Rate Tea

December 5, 2009

Lynne Kiesling

I drink tea. Lots of tea. Mostly strong, black tea with milk and some Splenda. I prefer Assam and its big, malty body. I’m not such a tea weenie that I drink only loose leaf tea, but I am enough of a tea weenie that when I travel home from London, I always bring back several boxes of Twinings Assam tea bags (not available in the U.S.) and at least a pound of loose-leaf breakfast tea from Fortnum & Mason. I know I’m pathetic, but I’m OK with that …

So I’m excited about Rate Tea, a new independent tea rating web site. In addition to being able to rate teas, it links to several other tea-related web sites, so it can serve as a tea portal (see, I warned you, I’m a tea weenie …). It looks like it will be thorough and useful, and now just needs to be populated with ratings. If you are a tea drinker, head on over, sign up, and rate some teas!

It’s also interesting because its proprietor, Alex Zorach, is a statistician with a particular interest in developing rating algorithms. Check it out!

UPDATE: Another good online tea community is Steepster, which has more of a social networking nature to it. Rate Tea and Steepster are complements, not substitutes.

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