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Supply and Demand in Restaurants and Bars during the COVID-19 Pandemic
Author
Institutional Affiliation
Course Code: Course Title
Lecturer’s Name
Date of Submission
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Supply and Demand in Restaurants and Bars during the COVID-19 Pandemic
Rachel La Corte in the article “New COVID-19 Restrictions on Dining, Gyms in
Washington,” talks about the measures taken by the Washington governor, Jay Inslee to
restrict local businesses as well as discourage social gatherings for one month starting on
November 15 , 2020 to assist in combatting the increasing infections of Coronavirus among
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residents (La Corte, 2020). The author goes further into describing how businesses like
restaurants and bars will have to limit their to-go services as well as outdoor dining. It has
been mandated that a single table is allocated a maximum of five customers while in normal
circumstances; such a space should be occupied with at most ten customers. The author
provides other facts such as existing research depicting that only 1% of all the patients of
COVID-19 in Washington have been claimed to acquire the disease in restaurants or bars (La
Corte, 2020). It is quite evident from the article that these types of businesses are going to
experience a drastic shortage in its customers making the supply for commodities higher than
the existing demand.
The article holds a strong economic idea which is market demand. Coppock and
Mateer (2018, p. 113) describe a market demand as the cumulative quantities demanded from
different individuals within a particular industrial market with each commodity being priced
independently. Bars have seemingly higher customers compared to restaurants in Washington
with each entity charging variable prices. A limitation placed by the governor makes both
entities suffer a significant reduction of over 50% of the state’s hospitality industrial market
demand while the supply for commodities continues to be affected increasingly. This results
from the companies having to down-size their personnel and reduce the number of suppliers
to only take in inventory that will satisfy the existing demand. From a profitability
perspective, price changes are going to incline significantly to sustain existing costs of
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operation while the quantity demanded depreciates over time as described in the law of
demand (Coppock & Mateer, 2018, p. 116).
The initiative taken by the Washington governor to reduce the number of customers
attended is essential based on the need to prevent more residents from contracting the
coronavirus while enjoying themselves in restaurants and bars. This results from the
increasing number of persons infected by COVID-19. This means, leaving people to freely
interact in social spaces may impact the restaurants and bars market-shares unpleasantly in
the future. Potential customers may succumb to the disease, making it hard for the demand
curve to reach its optimal state where an equilibrium exists in the hospitality market since the
demand will significantly drop as the supply upsurges nonetheless. Christians will be thrilled
with the idea of bars and restaurants is limited considering their strong belief that alcoholism
is a sin. Besides, it is in such areas that prostitution is practiced making their support for not
only partial reduction of the existing demand but also a full closure of businesses supporting
both alcohol consumption and prostitution.
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References
Coppock, L. & Mateer, D. (2018). The Market at Work: Supply and Demand. Principles of
Macroeconomics, [2nd Ed.]. pp. 107-131.
La Corte, R. (November 2020). Best States: New COVID-19 Restrictions on Dining, Gyms
in Washington. U.S. News. Retrieved on 16 November 2020, from
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https://www.usnews.com/news/best-states/washington/articles/2020-11-15/new-
covid-19-restrictions-on-dining-gyms-in-washington
