Date of Award

8-2026

Document Type

Thesis

Degree Name

Bachelor of Arts (BA)

Department

Social Sciences

First Advisor

Khemraj, Tarron

Keywords

Structure-Conduct-Performance, Restaurant Industry, Market Structure, Fast Food, Franchising, Industrial Organization, Competition, Consumer Welfare

Area of Concentration

Economics

Abstract

The restaurant industry is a very large and integral part of the economy in the United States. It aids in employing more than 15 million Americans and brings close to 1 trillion dollars in annual revenue to the United States. Despite the size of the industry, many people take for granted the forces that drive and structure it. In this thesis, we will use the Structure, conduct, and performance model (SCP) to demonstrate and analyze how the restaurant industry is organized, how various business in it compete, and what kinds of outcomes for restaurant owners, employees, and consumers stem from that competition. In economics, we use the SCP model as a framework to analyze industries. It uses three criteria to analyze an industry, the structure of an industry like how many companies are in an industry and what are the barriers to entry, the conduct of firms in an industry like how a company decides the price of a product or advertise a product, and the general performance of the industry like the profitability, efficiency, and general service to the public. In the United States, the restaurant industry is highly competitive in general, but specific sectors, like fast food, are much more dominated by a lower number of larger chains. In the fast-food industry, firms tend to compete more on brands, technology, and advertising rather than competing on price. The financial performance in the restaurant industry is highly varied across different segments, with fast food chains usually being more profitable than sit-down restaurants. Other factors that have led to change in the industry include the 2020 pandemic, new technology, new delivery platforms like Uber Eats, and new restaurant formatting which reshapes how firms compete in the restaurant industry. The thesis concludes by reflecting on the strengths and weaknesses of the SCP framework when applied to a service industry like restaurants and offers some policy considerations related to minimum wage laws, food safety, and business regulation.

Rights

The author has granted New College of Florida the nonexclusive right to archive, make accessible, and distribute for educational purposes this work in whole or in part in all forms of media, now or hereafter known. The copyright of this work remains with the author.

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