That may be the case but I would still maintain that people are willing to pay for atmosphere. Hopefully some our members in the restaurant industry will appear to back me up.
People are paying for three things:
1) Food
2) Service
3) Atmosphere
Look - my girlfriend and I can go to our favourite local pub and spend $50 plus tip and have great food and service. OR we can go to niagra on the lake to a place like this:
http://www.innonthetwenty.com/ott_restaurant.htm
We spent $150 there last year. The food is fantastic as is the service - and the restaurant was beautiful. Although as far as enjoying the food - I 'd say I enjoyed the food equally - I like pub food a lot. So what was I paying the extra money for? A different type of experience - the chance to eat a romantic dinner in a place "consistently rated as one of the finest restaurants in Canada". The atmosphere contributed in the end to me enjoying the food MORE.
There are a few new restaurants near me - the prices are probably double that of some of the family orineted chain restaurants in town. Is the food twice as good? I'd say no. So why are they always packed? They're young, hip, fresh, unique and classy inside. People are paying for the experience.
Let's consider celebrities. Why does Jennifer Lopez pay thousands of dollars for dinner? Certainly the food doesn't cost that much. She's paying instead to eat in the "It" restaurants.