Tipping is a unique phenomenon. There are various economic theories on the rationale behind tipping behaviour; two mainstream views are the narrow neoclassical view and the open-ended behavioural view. However, neither of these views provides complete explanations and insights into tipping behaviour. Tipping is a very important economic activity that accounts for a substantial part of our expenditures. Therefore the motives behind tipping should be a critical concern to us and there is a need to conduct in-depth analysis on tipping as an economic activity. <p> This study sets out to improve our understanding of tipping behaviour. In order to achieve this, possible socio-economic motives behind tipping are identified. There is an attempt to verify these motives with empirical evidence obtained in this study. A survey on restaurant tipping was designed and implemented, prompting respondents for their tip percentages as if they were dining in a restaurant. Using information so obtained, the socio-economic factors that influence individuals tipping behaviour was determined by econometric analysis.<p>Based on the results of this study, individuals may be tipping to conform to social norms, to be altruistic and to encourage better future service. Service quality, the tippers ethnic background and the tippers area of study seem to be the major determinants of tip percentages. Poor service is the main factor causing individuals to decide not to tip in a restaurant. An interesting finding is that individuals fail to accurately convert their expressed tip percentages to dollar amounts. This implies that individuals may be cognitively constrained. <p> Another noteworthy outcome is that 26% of all respondents choose to tip even when service is poor and when they are dining in a restaurant they will never visit again. This leads to the concept of a core and marginal tip. Without future service considerations, the mean tip when service is poor can be viewed as the core tip that is likely shaped by social norms and altruism. The marginal tip can be viewed as the increment in tips when service improves. Results of this study lead to the conclusion that tipping is a multi-faceted phenomenon. It is influenced by a number of different motives; therefore it is better explained by a combination of neoclassical and behavioural theories.
| Identifer | oai:union.ndltd.org:USASK/oai:usask.ca:etd-04252005-114605 |
| Date | 25 April 2005 |
| Creators | Fong, Shu Fung |
| Contributors | Schissel, Bernard, Huq, M. Mobinul, Bruneau, Joel F., Bishopp, William D., Altman, Morris |
| Publisher | University of Saskatchewan |
| Source Sets | University of Saskatchewan Library |
| Language | English |
| Detected Language | English |
| Type | text |
| Format | application/pdf |
| Source | http://library.usask.ca/theses/available/etd-04252005-114605/ |
| Rights | unrestricted, I hereby certify that, if appropriate, I have obtained and attached hereto a written permission statement from the owner(s) of each third party copyrighted matter to be included in my thesis, dissertation, or project report, allowing distribution as specified below. I certify that the version I submitted is the same as that approved by my advisory committee. I hereby grant to University of Saskatchewan or its agents the non-exclusive license to archive and make accessible, under the conditions specified below, my thesis, dissertation, or project report in whole or in part in all forms of media, now or hereafter known. I retain all other ownership rights to the copyright of the thesis, dissertation or project report. I also retain the right to use in future works (such as articles or books) all or part of this thesis, dissertation, or project report. |
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