Couple arrested for refusing to tip waiter, claim bad service

[mogrovejo]

Why didn't you look up "living wage" then? It is a concept in widespread common use:

http://en.wikipedia.org/wiki/Living_wage

and if you hate wikis:

http://www.wisegeek.com/what-is-a-living-wage.htm

or thousands of other pages.

A minimum wage below the living wage means that someone working 40hours a week in a minimum wage job still can't make ends meet for the basic necessities. Sound fair? Not to me. Sounds like a poverty trap to me.

I said I didn't know what you mean by living wage because it's a highly subjective, arbitrary (and disputable) concept. It's mostly an ideological/religious concept, hardly an economic one; and its translation to laws vary greatly in practice. The general procedure is just to equate the legal minimum wage to the living wage. In most economic literature, living wages is not treated as a concept de per si but as the minimum wage paid by some local communities in the US to the city employees. So far, most studies point out that the ins ution of "living wage" has lead to increases on unemployment among low-wage workers.

I also doubt that waiters in America don't rank at the top of the world in terms of percentage of living wage covered by their salary relatively to their peers. Do you have any evidence on the contrary? I'm not aware of any peer-reviewed research made on this subject.

As for suggesting this: "The minimum wage is no more or no less than a way of suppressing jobs. It has no other consequences", that is utter nonsense. Minimum wage laws protect workers, who have little power in the job market, from predatory practices by employers. There's been a lot written on the subject, maybe you should read some of it or talk to a job market economist.

BTW, for future reference I generally don't discuss things I don't understand, and you ought to look things up before you call someone out on them.

As an academic I have no use to argumentum ad verecundiam. As far as I know, and working myself on the field, the consensus in mainstream economics is that minimum wage leads to higher unemployment rates - unless it's settled at the equilibrium rate (the salary the employers would offer without the existence of a minimum wage) or bellow it, and in that case the minimum wage becomes useless at best, as it's easy to understand (there's a net loss due to bureaucracy/policy costs). There's some dispute on this coming from marginal/heterodox schools and economists, but the only empirical study I know about that contradicts the consensus is the very dubious Card et all (1992).

Do you care to explain your view?

For example, let's say that A is an employer (supply of labour) and B is looking for a job (demand of labour). A needs a new employee and he's willing to pay $x. If there's no minimum wage, B can accept or refuse the job. If the minimum wage is set at $x or $x-z, nothing changes. But if the minimum wage is set at $x+z, what do you think it would happen? Or, to phrase it differently, if minimum wage doesn't cause unemployment, why don't we set it at $1000 per hour?

Minimum wage can benefit very marginally those whose salary would be very close to it without its existence; but it also exercises the opposite pressure (lowering very marginally the salaries whose salary would be a bit higher) and leaves out of work much more people.

I agree with that - in general, I think American service is better than most other places.

Don't you think that's because of the different incentives scheme?

[mogrovejo]

, but why does the consumer put up with the service industry externalising its labour costs onto them? In such a consumer-driven society, I'm surprised people aren't up in arms about that!

That question doesn't make sense: they can't externalize a cost that doesn't belong to them. This is just semantics anyway. The client is consuming 2 services: the restaurant and the waiters' service. It's more transparent and allows the client to differentiate (and remunerate) merit better - hence putting a premium on quality and improving the market overall.

You make it sound like the consumer would pay less with a different system. They wouldn't (at least with the European system). Generally the more transparent a market is, the better is the cost/benefit relation for the buyer.

[RuffnReadyOzStyle]

I'm not going to argue the economics of minimum wage laws with you because if you argue it only on the basis of economics you are probably correct, however minimum wage laws are not purely based on economics. They are based on the power imbalance between employers and employees, and are a way to protect workers from exploitation. If there were no minimum wage laws, those in low-skill jobs (ie. highly replaceable workers) would be paid even less than they already are with all of the benefits accruing to the employers. Why do you think minimum wage laws are now ubiquitous across developed economies - to redress this power imbalance. Your argument suggests that if there were no minimum wage laws there would be more jobs, which may be correct, but what would be the point of that if the people in those jobs were earning a pittance and unable to support themselves? That would be great for the profiteers but neglects the fact that human beings aren't just economic units.

That question doesn't make sense: they can't externalize a cost that doesn't belong to them. This is just semantics anyway. The client is consuming 2 services: the restaurant and the waiters' service. It's more transparent and allows the client to differentiate (and remunerate) merit better - hence putting a premium on quality and improving the market overall.

You make it sound like the consumer would pay less with a different system. They wouldn't (at least with the European system). Generally the more transparent a market is, the better is the cost/benefit relation for the buyer.

When people go to a restaurant they are not consuming 2 services - delivering the food is not a separate service, it is part of the package of going to the restaurant, and the cost does belong to the restaurant because the people who deliver the food are employed by them.

I never said the consumer would pay less, and I agree that transparent markets are preferable to non-transparent ones.

[baseline bum]

As an academic I have no use to argumentum ad verecundiam. As far as I know, and working myself on the field, the consensus in mainstream economics is that minimum wage leads to higher unemployment rates - unless it's settled at the equilibrium rate (the salary the employers would offer without the existence of a minimum wage) or bellow it, and in that case the minimum wage becomes useless at best, as it's easy to understand (there's a net loss due to bureaucracy/policy costs). There's some dispute on this coming from marginal/heterodox schools and economists, but the only empirical study I know about that contradicts the consensus is the very dubious Card et all (1992).

Who even cares if a minimum wage eliminates jobs that wouldn't allow someone to pay rent, feed himself, and buy a bus pass to actually get to work? Should the state have to subsidize a company by providing housing to its employees when it pays so poorly that they have to live in shelters? I can't remember if it was you or Wild Cobra who was arguing that companies should be able to pay workers $4 an hour in the US, but any company that can't/won't pay it's workers enough to buy food and pay rent doesn't deserve to survive, as it's exploiting slave labor. The minimum wage ensures that anyone who works full time is able to feed himself, have a very modest apartment, and have transportation to and from his job through public transportation.

[polandprzem]

whottt made few hours of my day

This. You can easily make someone's day by leaving a good tip. Before I worked in a restaurant, I usually always tipped at least 15%. I now usually tip at least 25%, and my life has been better for it. I get comped drinks/food at bars/restaurants I go to frequently, and the staff is always happy to see me and my friends.

Nope, you pay them so they are acting they like you.
Try not to pay aditional and see if they like you or your money

Just like when you go to a nice place with dancing and stuff and order a (pros ute), you giving her the money and you tip her let's say 28% and she gives you the best blow job you ever had ! I doesn't mean she loves you man.

When people go to a restaurant they are not consuming 2 services - delivering the food is not a separate service, it is part of the package of going to the restaurant, and the cost does belong to the restaurant because the people who deliver the food are employed by them.

I never said the consumer would pay less, and I agree that transparent markets are preferable to non-transparent ones.

and one

How come I do not get tips for my job mr whottt?
I would love to have aditional untaxed money for the things I do. I'm not earning a lot. Waiter is a job isn't it? It's their job to provide service.
Nobody cares about my conditions at work and that I have to get up at 4:12 am to be ready at work before 7am be back home at 9:30 pm.
Boo hoo poor me huh?
But poor waiter service for earning much more then me. (giving the tips)

In some countries Mr whottt it would be an insult to give tip to a waiter. How is that? You would give you 20% tip they would arrest you

In Poland it's still new this tip thing. Only because we heve free market 20yrs now. Before thet there was nothing in shops.


And when we are going to a restaurant (not many times in a year) for example some friends are looking at me like I'm a fool or something for giving 'big' tip. And I like to give tips. But it depends more on the bill rather then the service. Service is usually the same.

And I treat it like something aditional, that is something I does not have to do. I do not give tips in shops or drug stores or McDonald's service.
Do you give tips to the cleaning service in McDonalds Mr whottt??