Why do diners tip: rule-of-thumb or valuation of service?

Bodvarsson, Örn B.; Luksetich, William A.; McDermott, Sherry

doi:10.1080/0003684032000126799

Cited by 42 publications

(43 citation statements)

References 2 publications

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“…10 One exception is the study of Bodvarsson, Luksetich and McDermott (2003), who argue that using different econometric techniques (instead of OLS regression) in their sample of 247 diners in a Central…”

Section: Empirical Evidence On Tipping Behavior and Service Qualitymentioning

confidence: 99%

“…Usually this is done by surveying customers as they leave a restaurant and asking them about the bill size, how much they tipped, service quality, and other questions that are of interest for the purpose of the research. Examples for this type of study include Lynn and Grassman (1990), Bodvarsson and Gibson (1994), Conlin, Lynn, and O'Donoghue (2003), and Bodvarsson, Luksetich and McDermott (2003).…”

Section: Literature Reviewmentioning

confidence: 99%

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Incentives and service quality in the restaurant industry: the tipping–service puzzle

Azar

2009

Applied Economics

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Tipping is a significant economic activity (tips in the US food industry alone amount to about $42 billion annually) that was claimed to improve service quality and increase economic efficiency, because it gives incentives to provide excellent service, and therefore allows to avoid costly monitoring of workers. The article suggests that this common wisdom might be wrong. A simple model shows formally that tips can improve service only if they are sensitive enough to service quality. Empirical evidence suggests that tips are hardly affected by service quality. Nevertheless, rankings of service quality by customers are very high; the co-existence of these two findings is denoted "the tipping -service puzzle," and several possible explanations for it are offered. Keywords: tipping, service quality, social norms, waiters, restaurants, the hospitality industry.

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Section: Empirical Evidence On Tipping Behavior and Service Qualitymentioning

confidence: 99%

Section: Literature Reviewmentioning

confidence: 99%

Incentives and service quality in the restaurant industry: the tipping–service puzzle

Azar

2009

Applied Economics

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“…Server friendliness has been shown to be a direct predictor of tipping (Bodvarsson et al, 2003;Brewster, 2012a). This indicates that higher levels of service compensate the server for doing a good job.…”

Section: Linear Regression Analysismentioning

confidence: 99%

“…Tipping is used as the incentive that ensures quality service (Bodvarsson et al, 2003;Brewster, 2012a;Brewster, 2012b). However, this does not always hold true and service is not the only factor that affects tipping.…”

Section: Introductionmentioning

confidence: 99%

Factors Affecting Restaurant Consumers' Tipping Behavior

Cho¹

2014

Journal of the Korean society for quality management

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This study examines the relationship between tip amount and its possible antecedents: bill size, the Big Five personality types, meal type, food quality, atmosphere, service quality, consumer gender, server gender, customer hospitality experience, race, and alcohol consumption. A survey of southeastern undergraduate students was conducted to collect information about the customer, server and customer tipping habits. While the analysis suggests that service is an important factor, it shows that other factors affect tip amount. Furthermore, these factors affect tip amounts in many different ways. Some examples of these factors include bill size, alcohol consumption, gender dynamics, meal type, food quality, and personality type. The conclusion suggests the intuition behind these factors by providing a dissection of their meaning and their importance to servers, customers, and managers alike.Purpose: This study tests restaurant customer tipping habits and some personality traits that have received limited previous attention as predictors of tipping.Methods: This study is that the tip amount was self-reported, business students at a university in a large southeastern city of USA were asked to complete a tipping journal.Results: This study was able to replicate the service-tipping relationship. Moreover, this study reiterated that server friendliness is a very powerful tool to increasing tips. Conclusion:This study strongly indicate that service has a positive relationship with tip amount, and also produce a positive relationship with emotional stability and a negative relationship to conscientiousness.

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“…For instance, etiquette guides suggest tipping 15 to 20 % of the bill size in the USA (Lynn, 2006). The empirical studies support this norm: Conlin, Lynn, and O'Donoghue (2003) reported the average gratuity to be 17.5 % of the bill, Lynn and Latané (1984) about 15.5 %, Bodvarsson and Gibson (1997) 15 % (but it differed among restaurants), Bodvarsson, Luksetich, and McDermott (2003) 14.3 %, Lynn, Jabbour, and Kim (2012) 10-16 %, and Harris (1995) about 14 %. However, some researchers found lower gratuities.…”

Section: Literature Reviewmentioning

confidence: 58%

Determinants of Gratuity Size in the Czech Republic: Evidence from Four Inexpensive Restaurants in Brno

Kvasnička¹,

Szalaiová

2015

Review of Economic Perspectives

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Abstract:The paper presents the results of the first study exploring what factors influence tipping in restaurants in the Czech Republic. It shows that the tipping norm evolved here into a form that has some features similar to the tipping norms known in the USA, Canada, and Israel, but there are also striking differences. As in the three countries, the gratuity increases with the bill size but the gratuity as percentage of the bill is much lower here. The bill size explains here a lower part of the gratuity variability too. Also, the service quality results in customers being more generous with their tips, and though the increase in gratuity seems to be small, it rises with a group size. Strikingly, the regular patrons tip significantly less in the Czech Republic and they stiff more often. This supports the hypothesis that the relationship between the customer frequency and the gratuity size is an artifact of a missing variable, and the regular patrons tip differently because they belong to a different social group than occasional customers. Also, the customers paying by card stiff more often here and the interaction between the amount on the bill and use of payment card is statistically insignificant. The group size lowers the percentage gratuity, which supports the diffusion of the responsibility hypothesis. There are differences between genders: Male customers leave bigger tips than female customers, and female waitresses earn more than their male colleagues. The time spent at the table, consumption of alcoholic beverage, and smoking do not change the gratuity size but it may be affected by the weather conditions. The customers tip less and stiff more often when they order a lunch special. They round the total expenditures, not the gratuities, which creates the magnitude effect.

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Why do diners tip: rule-of-thumb or valuation of service?

Cited by 42 publications

References 2 publications

Incentives and service quality in the restaurant industry: the tipping–service puzzle

Incentives and service quality in the restaurant industry: the tipping–service puzzle

Factors Affecting Restaurant Consumers' Tipping Behavior

Determinants of Gratuity Size in the Czech Republic: Evidence from Four Inexpensive Restaurants in Brno

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