Behavioral economics of entrepreneurs: Why do we tip, when and how much? - News Summed Up

Behavioral economics of entrepreneurs: Why do we tip, when and how much?


Let me advise my readers in advance, this is dense stuff, and a basic grounding in math will be advantageous. AdvertisementNow, let’s take a rational look at tipping for service in an effort to better understand behavioral economics. The POS (point of sale) system has anchored default tipping. You paid for a service — being driven somewhere — and then you decide to leave a tip. Donkor looked at one billion taxi transactions paid by credit card and found that 97 percent left a tip, and the amount was about 20 percent.


Source: New York Times January 24, 2022 14:01 UTC



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