In July 2010, New York City began requiring restaurants to publicly post letter grades summarizing their sanitation reports. The highly publicized system was well intentioned, but it’s broken.
We know from decades of social science research that mandated information disclosure often fails; think of the byzantine disclosures contained in mortgage agreements, drug labels or software licenses. But the emerging consensus is that simplified and “targeted” disclosures — like the restaurant sanitation grades — are a promising avenue to inform consumers and help them make better decisions. Evidence from Los Angeles County, for example, suggests that grading restaurants can reduce hospitalizations for food-borne illness.
The New York City Department of Health and Mental Hygiene deserves substantial credit for leading the charge for targeted disclosure and, more important, making detailed inspection data publicly available.
But the current system is ineffective. Along with researchers at New York University, Stanford and Yale law schools, I have studied data from more than 500,000 inspections of more than 100,000 restaurants from the last few years in nine jurisdictions: Austin, Tex.; Catawba County, N.C.; Chicago; El Paso; Florida; Louisville, Ky.; New York City; San Diego; and Seattle. Our research examined the process for tallying violations and the consistency of inspections across repeat, unannounced visits to the same restaurant. In a critical dimension, New York performed the worst of the nine.