On the contrary: most tipped employees I know make substantially more than the untipped ones. The why is simple: price discrimination extracts excess value. If everyone's paying the same price, you lose some potential profit from people who would have been willing to pay more, and you lose some potential profit from people who aren't willing to pay the set price, but would have been willing to pay some still-profitable lesser price. By charging people based on their willingness to pay, you extract much closer to the maximum value.

Tipping is a price discrimination scheme that directly benefits the workers. That's a lot of value that can be captured, and any other system that a restaurant could use to extract that value would end up benefiting the owners far more.

Although it can benefit workers, the employer can hire better, lower the wages of the tipped employees, and make rules for the tips. Yes, I guess the customers are less reluctant to spend the money though.

IMO, California's tipping law is the ideal: None of the "offset minimum wage with tips" tomfoolery, if tipping pools exist they must only be shared with employees and be a written policy explained at time of employment.

In that context, I like tipping. I tip well, which gets me better service at places I go often.

hmmm... I looked and you are right. california requires minimum wage and tips do not count against that.

I can see why the doordash tipping fiasco was so dire.

Thanks for writing this out, finally someone has taken microecon 101.

Most people feel entitled to the value of their labor; tipping is merely the incidental mechanism that yields that value.

Put another way: we don't have any reason to believe that the author is abstractly "pro" tipping, only that he (shrewdly, like most people) recognizes tipping as a local optima that he has no real control over as a service worker.

The only way to reach the global optimum of no tipping and higher wages would be for customers to start to refuse to give tips.

Not really. That only punishes the worker, not the interested business.

Tipping is pernicious precisely because it doesn't have a real disincentive in a culture that's already normalized it. The only real solution is unilateral legislation, without waiting for the culture to change.

It indirectly punishes the business because it raises the minimum salary that workers will accept to work there

> Not really. That only punishes the worker, not the interested business. [...] The only real solution is unilateral legislation, without waiting for the culture to change.

The day unilateral legislation gets enacted will be the day restaurants replace most of the wait staff with ordering kiosks and automated drink dispensers.

Waiting on government to fix your problems is a fool's errand.