FlyerTalk Forums - View Single Post - Tipping v. fixed service charge
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Old Oct 24, 2014 | 10:16 pm
  #6  
davie355
 
Join Date: Nov 2013
Posts: 4,374
Originally Posted by Often1
In the end, people consider how much a meal costs. If it's $150 pp. by the time you leave, it doesn't matter whether and how things are divided up.
That's the logic of rational economics, which breaks down in the face of consumer psychology.

When 2 + 2 Is Not the Same as 1 + 3: Variations in Price Sensitivity across Components of Partitioned Prices

Exactly how a discretionary vs. mandatory service charge affects anything (service quality, consumer sentiment, economic demand) is not well established in the literature, so all foregoing posts are speculation.

Last edited by davie355; Oct 24, 2014 at 10:59 pm
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