Consumers Incentivizing Employees, “Let Me Give You a Tip”

Abstract

This study aims to examine tip predictors in restaurants alongside tip amounts during and post-COVID-19 era. A face-to-face cross-sectional survey was carried out to obtain data from restaurant customers on several tip predictors. A probit model and limited dependent-variable technique are used in verifying the effect of each determinant on tipping behaviors. While examining tip predictors in study 1, results show that good service quality, religious background, education level, income level, financial social status, gender, and the effect of COVID-19 on service quality positively and significantly affect consumers’ tipping behaviours. However, results of consumer tip amounts revealed that consumers’ monthly income, holidays, weekends, and month ends positively affect consumers' tip amounts. These findings imply that though there are many factors affecting people to tip, tip amounts increase during month end when workers have received their wages, during weekends when people spend more time dining out, and during holidays when family responsibilities such as meeting school needs have reduced. This study is therefore unique as it examines the effect of COVID-19 on consumers’ jobs and service quality. Likewise, works are scanty in the context of this study and the theoretical background of consumer tipping behaviours is thus elaborated hereafter.

Keywords

• tipping behaviour
• tip predictors
• restaurant consumers
• covid-19
• service quality