r into the employer phase of the practice, the economics of
tipping in individual instances will be an interesting study.

V

THE ECONOMICS OF TIPPING

The basic question is, does tipping represent a sound exchange of
wealth? Do the American people receive full value, or any value, for the
$200,000,000 or more given in tips?

Values, of course, may be sentimental as well as substantial and, so far
as tipping is concerned, it can be demonstrated that if any values are
received they are sentimental. The satisfaction of giving, the balm to
vanity, the indulgence of pride, are the values obtained by the giver of
a tip in exchange for his money.

It is a stock argument for tipping that the person serving frequently
performs extra services, or displays special painstaking, which deserve
extra compensation. Only an examination of individual instances can
determine whether this is true. The proportion of the tipping tribute
which really pays for extraordinary service is negligible. A brief
inquiry into a few of the more prominent instances of tipping follows.

THE WAITER

If food is sold undelivered, then the waiter in bringing it to the
patron and assisting him in its consumption does perform an extra
service for which payment is due.

But this is not the fact, any more than that a shoe clerk should be
tipped for assisting a customer in the selection of his employer's
footwear. In both instances, the cost of the service is included in the
price of the article--food or shoes.

The prices on the bill of fare have been figured to include all costs of
serving it, such as cook-hire, waiter-hire, rent, music, table ware, raw
materials and overhead charges. If a sirloin steak costs seventy-five
cents a definite part of that amount represents the wages of the waiter
serving it.

Thus the waiter has no claim upon the patron for compensation, because
the patron, in paying for the food, provides the proprietor with funds
from which the waiter's wages will be paid. If the patron, in addition,
gives the waiter a tip it is clearly a gift for which no value has been
returned. The waiter is paid twice for one service.

ECONOMIC WASTE

The question then recurs, is this gift to the waiter a sound economic
transaction? Economists teach that no transaction is industrially sound
which does not involve an equal exchange of values. The exchange of five
dollars for a pair of shoes is a sound transaction because the dealer