Should comparative meal costs factor into tip consideration?

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Two friends go out for breakfast, each ordering eggs, toast and coffee. The total bill is $20.00. They agree to leave a 20% - $4.00 tip for the fast and friendly service. The following week, the same two friends go across the street to a comparable restaurant and again order an eggs, toast and coffee breakfast. This time the total bill is $22.00. When it comes to deciding the tip, one friend suggests that the tip should be the same as last week, 20% - $4.40. The other friend reasons that because the food, the service and the dining experience were essentially the same, the total amount paid, $24.00 should be the same, meaning a $2.00 tip. This friend further reasons that if the restaurant owner is charging 10% more for the same meal, the staff should be compensated accordingly higher. What are your thoughts? When all other factors are essentially equal, should comparative meal costs factor into tip consideration?


The writer has already shown that a good argument can be made either way. There is no correct answer the way the question is framed. The friends will debate the question until the restaurant closes. So, let's give them something else to debate that might help.
The same debate arises for any commission service. Real estate agents typically get 5 percent commission whether you buy a 100,000 dollar house or a million dollar house. Did they give you better service for the million dollar house? It is a fair question. But, the question in some sense is moot. With an agent you enter into an explicit contract where you know the 5 percent commission is the rule. That contract is the agent's livelihood and he or she is dependent on you to honor the contract. You are not the only client. 5 percent on average keeps the agent in business.
A waiter or waitress may not have an explicit contract, but as a society, for better or worse, we appear to have decided there is some sort of a contract and the going rate is 20 percent.  (If you have worked as a waiter or waitress you know your real salary is the tip, not your paycheck. The correctness of that is fodder for another question to this site.) Nonetheless, because it is not an explicit contract, tipping isn't enforced and whether the service is poor or the service is outstanding,  one is under no legal obligation to tip. So, asking, why tip higher than you tipped at the first restaurant is akin to asking is there a social contract?
Well, to answer the question, let's  ask it differently.
Do you ever plan on eating at the second restaurant again? Your answer to THAT question may, er, TIP the debate.

Answered by:
Dr. John Crespi
Professor and Director of CARD
Last updated on November 19, 2021