What questions do you have for Tyler Cowen?

Why does tipping so prevalent in restaurants but not in other parts of the economy?

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    alon honigalon honig shared this idea  ·   ·  Admin →

    8 comments

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      • Rachel ElorriagaRachel Elorriaga commented  · 

        I can add to this from the house cleaning industry which my experience extends beyond not only working as a cleaner but also help run a cleaning company with many years of experience in different economic sectors of the industry.

        First off the tipping rhetoric has been negative for a while and has contributed to exploitation from both the housecleaner and the consumer in the form of tax avoidance and paying correct wages.

        I currently have been advocating away from tipping to the point where I have voiced to my customers that I will be coming up with a comprehensive contract that will not accept tips unless it is in the form of payment through a charity that pays down healthcare debt I owe. My past experience has been that Christmas tipping is generally recognized as mandatory within the house cleaning industry but has been decreasing the last few years. Other forms of tipping have been seen in over the top type cleanings but also has been in decline. Tipping has increased though to obtain more cleaning outside the regularly paid scope instead of seen as a thank you. Which is why I am moving away from it, the line of expectations to provide a service is being clouded with the use of tips and causes resentment by both the consumer and the house cleaners. Managing expectations in this industry is already extremely difficult due to the rapidly diversified groups of new consumers who have different budget constraints and lifestyles along with the larger homes that have been built.

        By providing the payment through a charity allows them the tax deduction and view on how I don't earn enough money to pay down my healthcare debt.

      • Danny WiseleyDanny Wiseley commented  · 

        When I visited Germany, I was told it was rude to tip the wait staff.

      • Anonymous commented  · 

        Would love to see this one answered! Simple question like these sometimes shed some fundamental understanding... or at the very least, it's a good ice breaker.

      • RobRob commented  · 

        In Europe it *is* normal to tip the waiter in a restaurant (indeed, it would usually be rude not to), but we don't give tips to many of the other people that you do in the US: bartenders, taxi drivers, various staff in hotels, and I don't know who else. Anyway this difference is an interesting question.

      • HenkHenk commented  · 

        Why is tipping in restaurants in the USA so prevalent--but not so in Europe? In Europe the tipping is always included in the price of the food.

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