Tip Rates (IMAGE)

American Institute of Physics

Tip Rates

Caption

Left: Average reported tip rate in American restaurants over time, according to the NPD group (1982-1984) and Zagat annual surveys (1989-present). Right: For conventional tip rates below some critical threshold Tc, a rational restaurant owner would allow diners to leave gratuity to maximize profitability (black curve). Beyond that critical threshold, a rational restaurant owner would disallow tipping in their restaurant (red curve).

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Sara Clifton

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