Tipping is not (yet) a city in China

The Wikipedia article on tipping indicates that there’s no clear trend worldwide about tipping; it doesn’t seem that it started in one culture and then carried on in places where that culture had influence. Hong Kong, which like mainland China has no native tradition of tipping, has begun to see it under Western influence, but in Australia and New Zealand, obviously culturally Western places, it’s very rare. Jordan has a culture of tipping, Belgium does not. In many places, again on something of a checkerboard pattern, tipping is not the norm, but will be used to reward exceptional service, so that it is a known but not everyday phenomenon. One common practice is a third way in which many places have a “service fee” or some such thing that includes the money Americans would leave for tips as part of the bill.

(I have a humorous recollection of being in Uruguay with some other Americans asking our local friends how to say “tip” in Spanish. We had to explain what it was, and all they could think was why in hell you’d leave money after you paid. There is a word, actually, but it’s not used there!)

It’s ingrained enough into US culture that there’s an exemption from the federal minimum wage for it. What I wonder is if a culture that does include tipping would ever phase it out. I can think of:

  1. Enough people migrating from a non-tipping area to a tipping area to change the balance. This is unlikely for large countries like the US because if it became uncommon in some zone it would still be common in others around it.
  2. Included fees becoming common enough that people stopped tipping overall. I could imagine restaurants being hard-up and sneaking extra fees onto the receipt, but adopting this would have to happen very quickly over a wide-spread area. Maybe it would be a gradual lowering of the gratuity limit (from large groups to mid-sized, one or two people at a time, and then just an expected part of a meal).
  3. People becoming more rude overall, although old folks complain that this is happening already, and it hasn’t led to tipping being phased out.
  4. The nuclear option: the US government drops the minimum wage exemption. People now know that restaurants are paying full wages to servers, and correspondingly they stop tipping either from increased food prices, the reduced social obligation, or both. I don’t know for sure, but I’m told some places in the US have a city or state minimum wage that doesn’t have a service exemption, e.g. Portland, so I wonder if people are gradually tipping less there. This could be counteracted though, as mentioned in point 1.

On the contrary, tipping in the US seems to be subject to “inflation”. It used to be 15% as a general standard, as far as I’m aware, and now I see tip calculators and receipt suggestions for 18% and 20%.

Cultures with strong concern for social obligations (e.g. by having popular welfare state policies, or high charitable giving, or some kinds of proxies) don’t seem to have correlations with the prevalence of tipping.

I’m sure this has been amply covered elsewhere, I just haven’t read those sources yet.

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Author: rfmcelroyiii

Student and instructor of economics.

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