Question

In: Economics

Is tipping good for the economy? does tipping play a positive or negative role in our...

Is tipping good for the economy? does tipping play a positive or negative role in our economy and should it be kept in practice? (2-3 paragraphs)

Solutions

Expert Solution

Tipping is good for the economy. I’d say yes. It enhances the connection between a customer and servant. It encourages the servants to work more efficiently and dedicatedly. It is like a thank you gesture from the customer to the servant. The tipping can be given on the basis of the servant’s nature and skills. A skillful person sure should be rewarded for his skills. In case of absence of tipping, there will be no motivation for the workers to improve their services. Although, it is an individual’s choice if he wants to give a tip. Some people give it, some don’t. However, tipping makes the experience better. Some people tips the workers out of human connection which is really appealing.

However, besides the benefits and good things that exist about tipping, it plays a negative role also. There exists a peer pressure sometimes due to which some customers end up paying tip even when the servant don’t deserved to be tipped. The mentality of mandatory tipping should not be encouraged. Tipping also costs extra to the customers. This has nothing to do with the company’s bills. The tip that the servant takes is over and above the bill amount. If this practice is to continue then say, the restaurant should load off a particular share of prices from their menu for the benefits of servants.

It should only remain in practice if the problems that there are can be resolved in any which way.


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