I disagree with this. I'm reading your claim as "you should pay people so they become your friends." There's plenty of stores I've been regulars at that don't have a tipping system that I've become friendly with staff with. When I was a teenager and worked at movie theaters I became friendly with many regulars and tipping doesn't exist there. The warm fuzzies come from social interaction, face recognition, and being rememberable through your good/frequent business and friendliness. It feels wrong to suggest we should be buying them. That would just be confirming the bribery/feudal aspect of the system. I also don't think this helps those working non-tipped based jobs.

I don't want to abolish tipping, but instead I want to raise the minimum wage, make prices transparent (I am also a proponent of including tax in price listings), and making not tipping socially acceptable. If we have to supplement wages with tips then our economic system is broken (and akin to feudalism). If you want to provide an extra reward or explicitly bribe an employee for faster/better service (or to flex your wealth), I have no qualms.

Those same arguments apply to several other professions where it is not customary to tip. The reality is that tips are expected only for the lower social/economic classes, where it is acceptable that the price for labor is set based on the whims of the customer instead of being pre-agreed (which, personally, I find degrading).

Right-leaning people like it because it creates a power dynamic. Left-leaning people like it because they delude themselves that they're helping the working class. In both cases, it boils down to paternalism, and all other reasons are rationalization.

The existence of restaurants, barber shops, delivery services, all over the world in first world and developing countries indicates it's possible to run a business successfully without relying on charity or variable pricing models.

Except many other industries don't have tipping and the price of labor is just built into the cost.

It also allows game players to simply avoid tipping entirely, thereby getting a much cheaper set of good across all of the places that take tips.

Reinvest the savings and get rich off the stupidity of the system. Belligerence seems to be the only way to fix the system.

And managment should be aligned on happy customers if they want to stay in business for long. Maybe I'm missing something else.

Friendliness or a general level of service is in a lot of industries considered a competitive factor that contributes to increased customer lifetime value through repeat sales, loyalty etc.

Why should the restaurants be any different? If I like the food and the service, I'll want to come again - the restaurant increases their earnings that way and both I and the business are happy.

The question then again comes down to how is that an incentive for the workers. The obvious answer is that their pay should be linked to the earnings of the business. The fact that it is not shows the fundamental problem with current state of capitalism, where the primary goal is to exploit the work of the workers below your financial level (as a business owner) and increase your wealth based on the ever-increasing difference between costs / wages and revenue.

The incentive of business is in conflict with incentive of workers, and the interest of customers - business will be motivated to use the workers willing to work for less, count tips towards salaries, but also use lower quality/cost ingredients etc.

A system where the worker salaries would be linked to revenue, with some nuance of course, would ensure top quality / service / products for the customers, fair reward and aligned incentives for the workers, and access to top tier employees (since they would want to work for businesses with higher revenue), happy customers and increased revenue to the business.

> I also should have added, and probably led with, the fact that tipping addresses a big agent-principal problem in hospitality: in restaurants where servers rely on tips, their incentives are strongly aligned with those of customers; without tips, virtually all the incentives are aligned with that of management.

Very astute of you to mention this, though “address” and “cause” could be used interchangeably.

When I was a bartender it was always in my interest to give away free alcohol to my highest tipping customers, who generally understood that it’s customary to add 50% of the cost they would have paid to their tip for each free drink.

At a very surface level, the tipping system incentivizes employees to steal product from the business to give to customers. But the game theory gets very complicated. Sometimes this results in a great customer base that forms the core of a “social engine” that powers the popularity of a bar/restaurant and results in a win-win-win. Bar owners set various levels/thresholds/criteria for how much free sample can be given out and under what circumstances.

Tl;dr: the principal-agent problem can almost never be solved to align all parties in a system.