Think about a major issue restaurants. There is a major division in terms of staff: back of house (cooks) and front of house (waiters/waitress) . From of the house staff depends on tips while back of the house staff earns a flat wage with no tips. consider that the tips are a percentage of the total meal price( e.g 15% of the meal price ) and that meal prices have been rising over decades- even adjusting for inflation. a. Given that people respond to incentives what will likely happen over time to the number of people who become waiters/waitresses? b. How might restraunts employers view such a moment to raise tips? d. Suppose the restaurant market is competitive. Also assume that you like having more restaurants to choose from rather than few. Given these assumptions, how would you feel about this movement for greater tips?
Think about a major issue restaurants. There is a major division in terms of staff: back of house (cooks) and front of house (waiters/waitress) . From of the house staff depends on tips while back of the house staff earns a flat wage with no tips.
consider that the tips are a percentage of the total meal price( e.g 15% of the meal price ) and that meal prices have been rising over decades- even adjusting for inflation.
a. Given that people respond to incentives what will likely happen over time to the number of people who become waiters/waitresses?
b. How might restraunts employers view such a moment to raise tips?
d. Suppose the restaurant market is competitive. Also assume that you like having more restaurants to choose from rather than few. Given these assumptions, how would you feel about this movement for greater tips?
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