Abstract
Unique panel data provided by NPD Research, Inc., were used to investigate the magnitude and interactive effects upon tipping aggregates and levels. The analysis revealed that tips by American households aggregate to $6.2, $6.3, and $6.7 billion annually in restaurants and other eating places in 1982, 1983, and 1984 respectively. The information was collected by means of diaries kept by the tippers themselves, which was regarded as a more accurate source than inquiries of either the tip recipients or their employers. The paper covers the relationship between the characteristics of the tippers and of the tipping occasions and the propensity and magnitude of tipping. One finding of the regression analysis is that there are sizable differences in tip rates across tipping type restaur ant categories when the combined effects of geographic region, metropolitan size, and restaurant options such as acceptance of credit cards and reservations and service of alcoholic beverages are considered.
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