consumer psychology

The Psychological Case Against Tipping

Businessman paying the check at restaurant
Photo: Blend Images - Stewart Cohen/Pam

On Wednesday, Danny Meyer announced that he would get rid of tipping at all of his restaurants – news that broke, oddly, alongside a viral story about a pastor in Ohio who gave a Domino’s delivery driver a $1,046 tip. The latter is a nice gesture, but to earn the 17,000 percent tip, the driver was made to stand under a spotlight in front of the entire congregation, while the pastor directed some rather awkward comments her way: “I hope that this can help you. I don’t know what’s going on in your life.” 

Welcome to the weirdness of tipping in America. It carries with it such a strong psychological pull that many consumers are unwilling to abandon it, and in light of recent estimates that 58 percent of a server’s income comes from tips, it seems as though there are considerable economic issues to untangle before many others follow Meyer’s lead.

The basic idea behind tipping, of course, is that service workers are getting rewarded for doing a good job, but the science simply doesn’t back this up. There’s decades’ worth of consumer-psychology research demonstrating that tipping hardly improves service at all. Michael Lynn, a Cornell University professor and one of the nation’s leading experts on the psychology of tipping, has studied this at length.  In one 2001 review of the literature, for example, Lynn analyzed 14 studies on more than 2,645 bills at 21 restaurants. “I found that the average correlation between tip percentages and service ratings was only .11,” Lynn wrote in a paper published in Cornell HRA Quarterly. “In other words, service ratings explained an average of less than two percent of the variation in a restaurant’s tip percentages.”

Better service did indeed translate to a better tip, in other words, but the correlation was minuscule. Another study, published in 2001 in the journal American Demographics, suggested that many people pretty much just tip what they’re going to tip, no matter what happens during their dining experience. That research found that about a quarter of Americans always tip the same percentage, regardless of service. And although the research once suggested that servers could improve their tips by scrawling a little “thank you” or a smiley face on the bill, the latest studies are now showing the opposite — that when servers do this, their customers tend to leave lower tips.

Servers can race around the restaurant at a break-neck pace in hopes of pleasing their tables, in other words, and yet the research suggests that they ultimately have very little control over the gratuity they earn. But even more pernicious than that, one study published last summer in the journal Sociological Inquiry found a racial component inherent to tipping. Customers at a Midwestern location of a casual chain restaurant tended to leave white servers more money on average than they left black servers, regardless of the quality of service provided. And, in another study of Lynn’s that will surprise absolutely no one, researchers found that female servers with bigger breasts and blonde hair received higher tips; in contrast, the larger a female server’s body size, the smaller her average gratuity.

From the consumer perspective, on the other hand, tipping does provide at least the illusion of control. One economist characterized restaurant tipping as a “risk sharing” relationship the customer and server enter into. That is, there’s a certain amount of uncertainty going into a dining situation: At the outset, you’re agreeing to a price without being sure of the quality of either the food or the service you’re going to pay for. Tipping is a way of mitigating this risk, theorized Luther College economics professor Steven J. Holland in The Journal of Socio-Economics, ensuring that when “the service quality is below what the customer expected, she can leave a smaller tip and pay a price that is closer to the service’s true value.” The customer, in other words, gets to hold most of the power here, and that’s not a feeling people are eager to let go of.

Likewise, in a sociology study of gratuity customs across 30 different countries, researchers found another link between tipping and power, though this time it was specifically the power over the person, not just the price. “They found that comfort with power disparities and hierarchies was connected to a tendency to tip,” wrote Livia Gershon last month for JSTOR Daily, “something they had predicted on the theory that tipping reinforces customers’ power over service workers.” A big part of the reason people like the practice of tipping is that they like the superiority that accompanies it. By abolishing tips at his restaurants, Meyer joins other restaurants across the country that have inadvertently set up a sort of real-time experiment in consumer psychology. It’ll be fascinating to watch how this shift in power dynamics plays out. 

The Psychological Case Against Tipping