A powerful tip: Power's impact on tipping behavior

Abstract

AbstractThe practice of tipping is omnipresent in the tourism and hospitality sector. Although, consumer's tipping behavior has been studied from myriad perspectives, it is surprising that extant research has not yet explored how consumers' in different power states can be nudged to tip more. With the help of five studies in the lab and field, the results demonstrate that a low‐power state is conducive for generating a higher tip if consumers' focus is on others due to enhanced empathy. Furthermore, as per the compensatory consumption model, powerless consumers desire power, so they are more likely to tip higher than powerful people when tipping is associated with status. Lastly, powerful consumers' propensity to tip higher is initiated when the expectations that others hold from them are made salient. Implementing these findings can maximize business' tipping revenue from both the powerful and the powerless consumers.