Does tipping make sense?

• Author: Lazarowitz, Elizabeth
• Position: ECONOMICS

Americans are being asked to tip more and more. But some are starting to question the centuries-old practice.

Nate Ouellette never thought about tipping the baristas at his local coffee shop. That is, until he became one.

"It's a lot of work. There are a lot of other things going on at the register that as a customer you don't see," says Ouellette, 22, a photographer who works part-time at Cafe Fixe in Brookline, Massachusetts.

Ouellette says he gets why some people-including his own mom--object to paying someone extra for pouring a hot drink and passing it across a counter. But he thinks serving coffee isn't any different than waiting tables in a restaurant.

"It's a service job," he says, "so I feel like you should be tipped."

As a social custom, tipping has been around for a long time. But with more Americans working service jobs and new technologies pressuring customers to tip more generously and more often, some are starting to question the practice. Is tipping fair to those giving and receiving the tips? Does it actually lead to better service? Does it still make sense in today's economy?

An 'Un-American' Custom

In the past, coffee shops and delis might have had an easily ignored tip jar on the counter. But with tablet computer touch screens now at many registers, tipping can be part of the checkout process. Under the watchful gaze of the clerk, customers may feel pressure to pay up.

"This is putting a new social pressure on customers," says Michael Lynn, a professor at Cornell University's School of Hotel Administration, who studies tipping. "It's up to me to leave the change in the tip jar, or not. Yet when you turn the screen around and I have to explicitly click 'No tip' in front of you, that's a lot harder."

At Cafe Grumpy, a coffee shop in New York City, patrons are presented with an iPad screen offering options for tips of $1, $2, or $3. While that may not seem like much in dollar terms, even the middle amount is a 50 percent gratuity on a $4 coffee. Last year, Starbucks updated its mobile app to let customers leave tips straight from their phones.

Many taxis, too, now have touchscreen credit card machines that suggest tip amounts. Researchers at the University of Chicago and Columbia University in New York did an analysis of 13 million New York City taxi rides. They found that screens with higher default tip options--20 percent, 25 percent, and 30 percent, versus 15 percent, 20 percent, and 25 percent--made people tip 10...