March 24, 2022 Reading Time: 12 minutes

Is the common act of tipping your waiter at a restaurant really a successor to slavery’s harmful legacy? Does tipping your bartender or Uber driver mean you are perpetuating the structural racism of the 19th century? These are the implications of the latest claim by Nikole Hannah-Jones, creator of the New York Times’s 1619 Project.

In a characteristic tweet-thread, Hannah-Jones declares that “[t]ipping is a legacy of slavery and if it’s not optional then it shouldn’t be a tip but simply included in the bill. Have you ever stopped to think why we tip, like why tipping is a practice in the US and almost nowhere else?”

It’s not the first time that the 1619 Project has made bizarre claims that try to connect mundane aspects of everyday life to slavery. When investigating Hannah-Jones’s theory of tipping however, I soon discovered that claims linking the practice to slavery have recently become a trendy talking point of the economic far-left.

In 2020, a self-appointed “fact checker” for USA Today wrote an article rating the tipping/slavery connection as “true.” Other far-left organizations such as the Ford Foundation have promoted similar claims in recent years. Several of these works share a common source: they justify their narrative about slavery’s relationship to tipping by invoking the authority of Saru Jayaraman – an anti-tipping activist who leads a minimum wage hike advocacy organization. While Jayaraman’s position should not be dismissed out of hand, it is far from a dispassionate scholarly analysis of the practice and its history. A quick glance at her 2016 book Forked – allegedly the academic version of this thesis – suggests that it is embarrassingly light on evidence. The book devotes fewer than 5 pages to the supposed slavery connection, very little of which relies on original sources or novel discoveries. It’s a flimsy book on which to stake such a bold thesis.  

As we shall see, the tipping/slavery thesis has holes that emerge vis a vis the historical record. But first, let’s consider its basic claim. The anti-tipping movement’s story asserts that American restaurant owners turned to a tipping-based compensation model in the decades after the Civil War as a way to underpay African-American workers in the service industry. They connect this narrative to a modern-day call for raising the minimum wage, and expanding its scope to replace tips as the main income stream for service industry workers. Like much of the 1619 Project, this particular claim attempts to enlist the injustices of the past as an activist tool to enact progressive economic policies in the present, which they then rebrand as a necessary corrective to the horrors of slavery.

There’s a problem with this history, as well as the broader talking point about tipping that media “fact checkers” have taken to repeating and disseminating in recent years. They fundamentally distort the history of tipping, which long predates the American Civil War and the end of slavery.

Like many topics in early economic history, there’s no clear record of when the first tip was given to a worker in thanks for a service. The practice was, however, widespread by at least the late Middle Ages in Europe. Also known as a gratuity, the practice takes its more formal name from the medieval French term gratuité – meaning a small amount of money that’s freely or voluntarily given to a person. Gratuities were apparently very common in that era – so common that they made their way into William Shakespeare’s plays. An example appears in Twelfth Night, first performed in 1602.

In the relevant scene, Shakespeare’s comedic knight Sir Andrew addresses a court jester, asking “I sent thee sixpence for thy leman; hadst it?” The performer responds “I did impeticos thy gratillity,” after which Sir Andrew requests a song. A “gratillity” is an obsolete English variation on the word gratuity.

In Tipping: An American Social History of Gratuities, one of the most comprehensive historical surveys of the practice, author Kerry Segrave noted that the origins of tipping were vague, “but it may have begun in the late Middle Ages” and in “Tudor England (1485-1603), a shift had taken place in that visitors to private homes were expected to give sums of money (known as vails) at the end of a visit for service rendered by the host’s servants above and beyond the usual duties.”.

With the passage of time, the act of giving a gratuity expanded beyond the nobleman’s court entertainers and into routine exchanges. Tips fulfilled a clear economic function. They allowed the purchaser of a service to convey satisfaction with the provider for the task being performed and contracted. An attentive waiter or bartender might expect a bonus in the form of a large tip, signifying customer satisfaction. Poor service, by contrast, might result in a low tip or no tip at all. Characteristically, the practice of tipping was not imposed by any central plan or committee. It likely evolved and spread over time, fulfilling an information problem around transactions. Simply put, it allowed a feedback loop between the service provider and the customer.

The practice of giving out gratuities was sufficiently widespread by the early 1700s that writers began to catalog the best practices of tipping etiquette. A representative example appears in the European travel writings of Edward Wright, first published in 1730. Describing a journey to Rome, Wright recorded that the “usual Gratuity to the servant who shews a Palace is a Te-stone,” or the equivalent of about 18 English pence.

Another account by the English explorer William Dampier recorded the practice of extending a “small Gratuity to the Servant” from his visits to the Far East while circumnavigating the globe. Early 18th century laws recognized the practice’s use in transport as well, differentiating between a fee for a service to the “Master” of the coach line and “Money [that] be given to the Driver,” which qualified as a gratuity. 

In time, tipping became a common practice for a multitude of duties – for meals in restaurants, for housekeeping in hotels, for cabin stewards on steamships, for stage-coach and carriage drivers, and as a way to convey satisfaction for musical entertainment. One English source from 1782 groused about the widespread adoption and even abuse of the practice, noting “those gratuities which were received some years ago as free gifts, and with a low bow, by clerks, waiters, drivers, servants in lodging houses, etc. are now imperiously demanded as a right.”

It’s unclear when tipping arrived in the United States, although newspaper accounts illustrate that it long predates the Civil War. What is certain, though, is that England had a well-established tipping culture in the 17th and 18th centuries. Segrave noted mentions of tipping as far back as 1668 from the diary of Samuel Pepys. It was a common enough practice by 1795 to garner frequent mention in newspapers. Short stories and novels increasingly conveyed that the practice was a routine part of life in England. Charles Dickens’ Old Curiosity Shop records its protagonist Nell Trent providing a “small gratuity” to a stagecoach driver for securing her a room at an inn. In another example, detective novelist Samuel Warren recounted a tale of a man who “incurred the enmity of this particular waiter in consequence of having, out of his slender resources, given him too small a gratuity on the occasion of paying a former bill.”

The common use of tipping in Europe establishes a very different origin story for the practice than the slavery thesis would suggest. In all likelihood, the custom simply transited the Atlantic with the European settlement of the North American continent.

Some early 19th century European visitors to the United States noted that the practice was rare outside of the major cities, contrasting to its ubiquity in England. An 1822 travelog by John Howson noted that “[i]n America, travelers are not expected to bestow any gratuity upon the waiters of a tavern, except in the large towns.”

Other records from the period expressed disdain for the cultural association of tipping with aristocratic traditions from the Old World. In 1836 a British writer expressed hope upon hearing reports that the practice was as of yet rare in the United States, contending that “this absurd and degrading practice has been handed down to us by the aristocracy.” Debates of this sort over tipping would persist for decades thereafter.

Insofar as these debates attest to shifting American attitudes on tipping, a multitude of factors were likely at play. Early 19th century America was significantly more rural than Europe, and was at an earlier stage of economic development, where many businesses were sole proprietorships with services provided by their owners. We would accordingly expect to see tipping to first emerge in larger cities where a professional service industry was starting to take shape. And so it did in American locales such as New York and Philadelphia.

By the late 1830s, clear signs of an emerging tipping culture were apparent in the United States. An etiquette book by Eliza Leslie (the sister-in-law of economist Henry Charles Carey), published in Philadelphia in 1839, reveals that tipping had already become customary in urban centers – even to the point of having elaborate practices and associated amounts that were specific to given tasks.

When staying overnight at the home of another, Leslie advised, “[g]ive a parting gratuity to each of the servants – the sum being according to your means, and to the length of your visit.” At public accommodations, ladies’ cloaks were to be deposited in the “charge of a responsible attendant; her care to be rewarded by a small gratuity.” Elsewhere in the book, Leslie advises on best practices for a variety of common services and scenarios at public businesses. Even the timing and mode of presentation had developed their own social customs: “When you give a gratuity to a servant – for instance, to the man who waits on you at table, or he that attends your room, or to the chambermaid or the errand-boy-give it at no regular time, but whenever you think proper, or find it convenient.”

Leslie further instructed that it is “right and customary to pay [doormen] extra for conveying your baggage up and down stairs when you are departing from the house or returning to it.” Persons in ill-health who required extra attendance were expected “to give a certain sum monthly to each of the servants who wait upon you.” Visitors to a Philadelphia hotel should similarly expect to tip for a variety of tasks with well-established rates and practices. For example, “[t]he errand-boy of the hotel carries parcels, and takes such messages as require an immediate answer. For a distance of any consequence, he will expect from twelve to twenty five cents. For little errands in the immediate neighbourhood, less will suffice.”

By the mid-19th century, a multitude of travel guidebooks and etiquette manuals appeared in print, advising on the customs and rates for tipping at different locales around the world (see Segrave, pp. 5-6). They offered advice not unlike that found in Leslie’s book, often tailored to specific cities or regions.

Some pieces such as the USA Today “fact check” hint at their awareness of this earlier history of tipping, only to handwave it aside for an alternative story in the United States that places the aftermath of slavery at the center of the story. They also contain clear inaccuracies, such as the contention that there was “no tipping in the United States prior to 1840” – a claim belied by the accounts documented here. The resulting story told by these sources is both oversimplified and willfully negligent of a broader historical context.

The post-slavery origin story of tipping is at odds with the evidence in other ways. Many 19th century commentaries on tipping clearly acknowledged its European origins, whether celebrating or lamenting its arrival in the United States. Mark Twain’s 1880 account of his journey through Europe, A Tramp Abroad, contained one such passage. “It seems to me that it would be a happy idea to import the European feeing system into America,” he wrote, referencing a particular type of tipping structure at European hotels that “keep a cashier on a trifling salary, and a portier who pays the hotel a salary.” 

Twain recalled the case of “a portier of a great Berlin hotel paid five thousand dollars a year for his position, and yet cleared six thousand dollars for himself.” The example highlights an extreme extension of the economic practices around tipping, where the worker did not even have an income base beyond the gratuities he received. Yet Twain’s point remains: Through the incentives of tipping and the ability to raise an excess for the delivery of good service, the portier was able to vastly improve upon what he would have made on a simple untipped salary. Once again, Twain reiterates that some hotels in the United States had “borrowed the feeing fashion from Europe a dozen years ago” – a clear origin that had no connection to slavery.

It is indeed true that tipping, as with many aspects of routine economic exchange, suffered under the distortions of racially discriminatory laws in the Jim Crow era. But those distortions do not explain the widespread adoption of tipping in other countries in the 19th century, or in Northern U.S. cities before the Civil War. They do not negate the clear European origin of the custom, or its gradual importation into the United States. Nor did they necessarily promote tipping at the expense of higher wages, as the account favored by Hannah-Jones, Jayaraman, and others contends. For example, the state of Mississippi passed a law around the turn of the century to prohibit tipping and gratuities across multiple service industry sectors. Similar laws were adopted in the former slave states of Tennessee, South Carolina, and Arkansas.

Supporters of the tipping/slavery thesis make little effort to explain this inconsistency, or the complications it creates for their historical narrative. Jayaraman, who apparently agrees with anti-tipping laws and advocates similar measures today, just glides right past the popularity of their precursors in the American South at the turn of the century. She does however tout an odd counterexample from Europe as it allegedly “continued to move in a no-tipping direction” around the same time. As Jayaraman (pp. 34-35) notes without even questioning the implications, “Italian dictator Mussolini banned tips being accepted from guests at hotels; the practice was seen as servile.” She then favorably contrasts this turn of events with the United States in the “same period and beyond.” The latter, she laments, “moved in the opposite direction, entrenching tipping and tips into custom and law.”

Taken as a whole, the incoherence of Jayaraman’s historical presentation is astounding. Tipping somehow emerged from slavery, even though turn-of-the-century anti-tipping laws appear to have clustered in the states of the old Confederacy. Meanwhile, her stated example of Europe’s anti-tipping turn comes from the fascist dictator Benito Mussolini? It would appear that the tipping/slavery thesis is a case of badly mistaken history, which Jayaraman then haplessly shoehorns into present day ideological cause without even realizing the historical implications.

Even if we were to charitably interpret Jayaraman’s thesis for calling attention to the role of tipping under Jim Crow era labor practices, it is not an origin story. At most, these accounts take a common and recurring practice that emerged externally to slavery, identify specific instances when racism was both pervasive and left its imprint on tipping and almost all other facets of life, and mistake those instances for a false genealogy of the practice. In this sense, the tipping/slavery thesis resembles similar erroneous claims from the 1619 Project. In one of the most notorious examples, 1619 Project contributor Matthew Desmond attempted to tie Microsoft Excel spreadsheets to slavery, simply because plantations – like almost any other form of production in that era, free or unfree – used accounting books.

The economic logic of tipping further suggests that if it was designed to subjugate workers of any race or ethnicity (including the Irish, Italians, and Germans who also faced labor discrimination), it was a bad mechanism to accomplish this goal. Individuals who engaged in repeated interactions with a tipped worker (e.g., bag porter, waiter) had a strong incentive to tip well to insure prompt service in the future. With other customers vying for quality service, there would naturally be upward pressure on tips, which served to benefit the laborer. An easier way to suppress the income level of any workers, irrespective of race or ethnicity, would be to mandate maximum wages and ban tipping (as in the example noted above).

Indeed, workers within the service industry today often make substantially more than the prevailing minimum wage when one includes tips (both declared and undeclared) in the equation. The attempt to move away from a gratuities model of compensation and towards a standard “living wage” proved to be unpopular among the wait staff even prior to COVID (see also here, here, and here). The pain inflicted upon the restaurant industry during pandemic lockdowns furthered the return to tipping.

When one thinks about it, giving the customer the opportunity to reward a worker for personalized service can potentially undermine racist (and classist) attitudes. While there undoubtedly exist individuals who did (and do) not want to pay somebody highly for whatever reason (including race, ethnicity, beauty, or age), there will be individuals who do reward quality service irrespective of these characteristics. Better service will naturally fall to those who do tip well, and if those individuals who harbor ill will towards others want to receive similarly high levels of service, they will have to pay accordingly. (Readers are welcome to conduct their own experiment on this assertion at their favorite local tavern.)

These incentives stand in sharp contrast with the well-documented historical legacy of another economic practice: the very same minimum wage laws that the critics of tipping defend. Although minimum wages today are often depicted as a means of assisting the working class as a whole, their early 20th century antecedents were adopted with clear and explicitly racist motives.

Progressive era reformers – many of whom believed in racial eugenics and similarly discredited theories – recognized that minimum wage laws also came with disemployment effects at the bottom of the wage ladder. Labor union interests strategically exploited this outcome in the 1920s and 1930s, knowing that African-American workers would be the first group to face layoffs after the imposition of a minimum wage. White laborers benefited from the increased hourly rate that these statutes mandated, but black laborers found themselves out of a job. It’s no small irony that the racist origins of minimum wage laws go unmentioned in the narratives preferred by Hannah-Jones and the aforementioned “fact checkers,” each of whom depicts the very same minimum wage system as an alleged corrective to the tipping economy.

It is not surprising that the typical rate of gratuities has increased over the years from roughly 10 percent in the 1950s to 20 percent today, benefiting those in the tipped service industry. Moreover, given that tipping represents a percentage of the overall bill, it tends to be a more inflation-resistant means of compensation compared to politically-determined minimum wage increases or the (potential) desire of employers to resist wage hikes.

These are important economic considerations, as they illustrate how the abandonment of a tipping economy could in fact harm the least well-off – both by undermining the beneficial signaling mechanism of the earned tip and through the potential disemployment effects of the proposed alternative of a minimum wage-only system. Now the critics of tipping have taken to augmenting their case with an error-riddled and distorted history of the practice – one that attempts to link it to slavery through a false narrative, all as it conveniently ignores the unambiguously racist history of their own competing minimum wage proposal.

At best, the critics of tipping are guilty of inexcusable sloppiness. At worst, they’re selectively weaponizing the horrors of slavery to advance an ideological cause. The unsuspecting readers of legacy journalism and its self-appointed “fact checker” websites deserve better.

Note: the author thanks Tony Gill for his comments and suggestions on this article

Phillip W. Magness

Phil Magness

Phillip W. Magness is Senior Research Faculty and Director of Research and Education at the American Institute for Economic Research. He is also a Research Fellow at the Independent Institute. He holds a PhD and MPP from George Mason University’s School of Public Policy, and a BA from the University of St. Thomas (Houston). Prior to joining AIER, Dr. Magness spent over a decade teaching public policy, economics, and international trade at institutions including American University, George Mason University, and Berry College. Magness’s work encompasses the economic history of the United States and Atlantic world, with specializations in the economic dimensions of slavery and racial discrimination, the history of taxation, and measurements of economic inequality over time. He also maintains an active research interest in higher education policy and the history of economic thought. In addition to his scholarship, Magness’s popular writings have appeared in numerous venues including the Wall Street Journal, the New York Times, Newsweek, Politico, Reason, National Review, and the Chronicle of Higher Education.

Selected Publications

“How pronounced is the U-curve? Revisiting income inequality in the United States, 1917-1960” Co-authored with Vincent Geloso, Philip Schlosser, and John Moore. The Economic Journal (March 2022) “The Great Overestimation: Tax Data and Inequality Measurements in the United States, 1913-1943.” Co-authored with Vincent Geloso. Economic Inquiry (April 2020). “The anti-discriminatory tradition in Virginia school public choice theory.” Public Choice. James M. Buchanan Centennial Issue. (March 2020). “John Maynard Keynes, H.G. Wells, and a Problematic Utopia.” Co-authored with James Harrigan. History of Political Economy (Spring 2020) “Detecting Historical Inequality Patterns: A Replication of Thomas Piketty’s Wealth Concentration Estimates for the United Kingdom.” Social Science Quarterly (Summer 2019) “James M. Buchanan and the Political Economy of Desegregation,” Co-authored with Art Carden and Vincent Geloso. Southern Economic Journal (January 2019) “Lincoln’s Swing State Strategy: Tariff Surrogates and the Pennsylvania Election of 1860” Pennsylvania Magazine of History and Biography, (January 2019) “Are Adjuncts Exploited?: Some Grounds for Skepticism.” Co-authored with Jason Brennan. Journal of Business Ethics. (Spring 2017). “Estimating the Cost of Adjunct Justice: A Case Study in University Business Ethics.” Co-authored with Jason Brennan. Journal of Business Ethics. (January, 2016) “The American System and the Political Economy of Black Colonization.” Journal of the History of Economic Thought, (June 2015). “The British Honduras Colony: Black Emigrationist Support for Colonization in the Lincoln Presidency.” Slavery & Abolition, 34-1 (March 2013) “Morrill and the Missing Industries: Strategic Lobbying Behavior and the Tariff of 1861.” Journal of the Early Republic, 29 (Summer 2009).  

Books by Phillip W. Magness

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