Casinos don't rake tables based on what it takes to pay the dealer.

Rake has been and will always be as much as they can possibly take from us without us going somewhere else or not coming at all.

Was the dealer that bad?

An increase in wages for dealers is, from the casino's point of view, a negative rake. So if dealer's wages go up, net rake goes down. You seem to be implying that the casino will just eat this, which I find highly unlikely. I'm pretty sure that they'll attempt to find some way to pass some portion of this increase in expenses along to the customer. Of course, this will lead to lower demand, but depending on how large their margin is, that is fine from their perspective.

Also, note that the actual amount of money paid by players remains constant in my three scenarios--all that changes is the method and distribution of payment.

What I'm saying is that when you go to the casino and don't tip, the cost of you paying less for a dealer than everyone else is paid for by the dealer in lower wages, the casino in lower profits, and the other players in higher rake. Since I'm not interested in subsidizing you to play poker when I go to the casino, I'm going to encourage you to tip (note: I don't say anything about people's tipping at the table or in the poker room).

Please explain to me how my encouraging you to stop free-riding is a negative externality. The article you linked claimed, somewhat unconvincingly, that tipping by rich people is a negative externality because it creates an expectation that those poorer than them must also tip, but I'm not rich, so I'm fully internalizing all the costs of tipping.

I don't necessarily agree that it's a zero-sum game.

Casinos have poker rooms because either (a) they bring in enough degenerate gamblers to offset space that could be another slot machine, or (b) they honestly believe they've saturated the slot machine market and have spaces which would generate more money.

While I think poker rooms would certainly try to better their bottom-line if they had to pay their dealers more by passing the cost along to us, I simply disagree that there's honestly any correlation now between the size of the rake (or time charge) and what dealers get paid.

For example, some locations can pay less than minimum wage, it being a tipped position and all -- other locations, minimum -- still others report paying higher wages. ...and the rake at those locations that have to pay an extra $10 an hour to their dealers don't seem to have a significantly higher rake than anywhere else.

Are the rooms that rake $4 (and thus generating $120/hr) paying their dealers less than the rooms that rake $6 ($180/hr)? ...or are the rooms that are raking $6 in markets that can simply bear the extra cost?

Wait what? You tip them more if they lie to you? When I ask that question I'm just looking for an honest answer, while you're playing a joke with someone's livelihood?

Weird, when I ask if I tipped (and it happens often, I forget) I'm honestly asking for a real answer. If the dealer says yes then I say OK and let it go. If they say no then I tip. Not looking to reward people for honesty like they're children and not looking to be treated like a child that might be offended by the word "no". Just a simple question with a simple answer

I don't have any actual information on this issue. I'm just relying on basic economic principles. It would be very surprising if there wasn't some basic correlation between the cost of running a poker room (which includes labor costs obviously), and the price of playing poker there--which is paid by the customer through the rake+tips. I suppose if a casino regards poker as primarily a means of getting more players into the casino, then the goal of driving up demand might swamp the relatively minor costs of paying a little more for labor. But in that case you might expect poker to be a better deal than it is now, and also the principle you bolded above would be false or unuseful.

A lot of the differences you describe above could depend on other extraneous factors. For instance, labor costs are regionally dependent, so to really compare poker rooms we would have to compare casinos in the same market (such as AC or Vegas), and with similar amounts of degen gambling from poker players, etc.

This is interesting because you are rewarding the dealer for lying.

I think you should rethink you reasoning for the Extra $4...

If i am asked this question, i tell you the truth. I know far to many players that will ask the question ( knowing what the answer is) with the specific intent of seeing if the dealer will indeed lie, if they lie, the tokes stop, at least for a period of time, if they tell the truth the tokes continue. If they tell you the truth, if you care to , "here are couple extra for being honest".

"i don't remember" is a ridiculous answer. Seriously, the dealer doesn't recall if someone toked them?
Makes the dealer look like a moron.

I like you personally Howard, and I enjoy your posts here, but no, you don't.


q/q

This is not an economics class. This is reality. Casinos pay the least amount they can by law. Some markets now have an excess of dealer applications but the casinos cannot lower their wages any more.


No. If the casino is paying the dealers minimum wage and for some reasons their tip income goes down by $10hr, the casino will continue to pay minimum wage.

Try reality. Casinos often overstaff to make sure they always have enough dealers for a full room, even though they have never filled all their tables. Too many dealers, not enough games, less tip income per dealer.

Casinos run mediocre tournaments that further reduce tip income.

According to you, these casinos would be forced to pay more in base salary.

They don't.



Take home: Your model is based on fantasy and has no relationship to reality.

The laws about how much employers have to pay their employees are influenced in part by how much money those employees make in tips.

As for this being an economics class--this is an economics issue so it would be foolish to ignore economic principles.

This seems extremely unrealistic. You are suggesting that if a poker room lost, say 10% of its business (loss of income through lower tips), that it could completely make up the difference by paying its service staff less. If that were really true, then we would expect poker rooms to already be paying its service staff significantly less than they are now. Your assumption here, which is likely false, is that dealers have no bargaining power with regards to their remuneration at all.

Huh? How has anything I've said implied that casinos wouldn't do this? I'm not claiming that casinos have to pay their employees any particular amount. What I'm claiming is that we should assume that the labor market for dealers, like most other labor markets, has already priced in the average amount they'll make through tips as part of amount they are paid. Whether that amount comes from the casino or the players directly probably won't affect the amount that much. As such, if there was a dramatic and sustained decrease in the amount that dealers get in tips, you would expect for them to either quit or get a increase in pay from the casino.

You seem to be suggesting that the casinos could just slash the amount paid to dealers by a third without them being able to do anything about it. If that were really true, then the market for poker dealers is incredibly inefficient and you should quickly open a poker room and cut wages for dealers.

You seem to have not understood what I'm saying at all.

I'm not suggesting that my scenario reflects how much dealers are actually paid. It is an idealized scenario to make a point--that tipping poker players have to pay more to make up for the free-riding non-tippers. Thus, as a poker player, you should encourage other poker players to tip their dealers so that the cost of paying for a dealer is more evenly distributed. Of course I realize that dealers aren't always dealing cash games with full tables--but that is already priced in.
You are the one that has decided to ignore economics.

Minor shortcomings aside, it's a pretty good article imo (though I prob only browsed through about half of it, so far). Before claiming social norms and social pressure (much in the same as you propose) to be a negative externality, the author discusses the inefficiencies of tipping and the weak correlation between tip wage and merit (as well as its true origins - it didn't arise as a ****ing extension of "American" ideals and meritocracy as someone earlier suggested). His argument is pretty coherent; at least what I skimmed. I didn't really see any fantastic solutions offered, but again I haven't finished reading. He spells out many of the vices of tipping pretty well p. 6-11ish iirc.

EDIT
Social pressure on and off the table is the same, in principle; but, likewise, I would never criticize someone at the table for tipping because it slows down the game, is impolite, and will likely be ineffective in convincing my opponent at that place and time. The proper venue for the discussion is off the table.

My above post has got me thinking about whether it's ok to try to convince people whether or not to tip. Right now, I'm thinking it is ok, but the table is not the place to do it. Earlier I wrote that it's no one else's goddamned business whether or not another person tips. Perhaps I was wrong, but I think, effectively, that is correct at the table.

California and Nevada both require that dealers be paid $8. Tipping is not an issue on minimum wages.

The rest of the country, an employer can pay less, if the average tip income brings the employee up to minimum wage. If a dealer isn't averaging $6/hr in tips, he should find another job. One or two players not tipping will not lower a dealers tip income to that point.

This is not a classroom exercise where you can make up you own "facts". I am not ignoring economic principles. You are ignoring reality.




Tips don't go to the house. They go to the employees. If players tipped 10% less, the casino doesn't make less money.

Again, reality. They don't.

Quit? Maybe. Casino pay more? Thanks, I needed a laugh.


Hello? Hello?
Almost every casino pays the minimum wage allowed by law. They can't cut wages further. But many want to.
But they do hire people part time so they don't have to pay benefits.



No, it is a fantasy. If every table had two "stiffs" , the rake would not increase. Dealers would moan and groan. Management would say "That's terrible". But they would not get paid more in base salary. The casino would not have to increase the rake.

You are the one that has decided to ignore reality.

I'm not arguing for the superiority of the tipping model over a non-tipping model (as you'll note in my original post in this thread, I actually pointed out that an advantage of the non-tipping model is that it gets rid of the free-rider problem).

Instead, what I'm saying is that if you are in a tipping model, then it is not just (or even primarily) dealers who are hurt by someone who doesn't tip, but the other players who have to subsidize your poker play. I don't want to do that, so I will encourage you to tip so that you don't free-ride off the paying customers.

Obviously I think it if fine to convince others to tip (since I think it is tipping players who end up paying the cost of non-tippers), but as I stated above, I never talk about people tipping at the poker table or in the poker room.

I also doubt that players won't see a change in costs incurred as I believe the tipping system to be inefficient.

I don't really care what dealers' wages are - if they make $20k a year that's fine w/ me and if they make $80k/yr then more power to them! But since this example is so plain and easy, I'll use it and maybe go into others later (I've already described or linked many): Consider a dealer's wage. Itt it seems to be close to or over $20/hr, correct me if I'm wrong. Devilhates said he would quit dealing if all he made was $20/hr. I would gladly take his place presently, especially in this economy. $20/hr @ 40 hrs/wk translates to $40k/yr. So let's say dealers make $40k-$50k/yr. Don't you think that's a little inflated (especially considering the likelihood that little of that is taxed)? To put it into perspective, a friend of mine who has a B.S. in Civil Engineering and an MBA (to be fair, he is a recent graduate with little to no experience) makes less than $50k/yr. Iirc he told me it was a little over $40k, let's say $45k plus, I think, benefits that I doubt amount to more than $10k in retail value - and he's not the type to bull****/exaggerate his salary one way or the other. Without a doubt the entirety of his income is being reported and taxed appropriately. Do you still doubt dealers' wages might be just a little inflated due to the social pressure to tip? Without the consumer/player subsidizing dealers' wages, true economic laws are able to govern; thus, making everything more efficient. This is but one instance of how some fat could be cut to save costs to the consumer/player.

Yet another example of gov't intervention ****ing up the economy.

In many states, employees who are paid through tips are not paid the minimun wage--I would imagine that if it is different in California and Nevada it is at least partially due to influence from the unions.

Again, I'm not talking about tipping at the level of the individual person. I'm talking about it as a systematic practice. Of course, for each individual person, whether or not they tip will not particularly affect the policies of the casino or the wages of the dealers. It is when you take the players as an aggregate that these effects become clear. If, say, 10% of players never tip, the 90% of players who do tip end up paying extra to make up for those 10%.

Okay. I think it is useful to help understand the principle, but if you don't want to address it, fine.

This is arbitrary. It would be very easy for a casino to take a percentage of the tips. Presumably, if the casino thought they could make significantly more money by doing so without damaging their poker room, they would do so.

Your response seems to be grounded in the idea that casinos are somehow a special kind of labor market. If you could tell me why you think so, the conversation could progress beyond a few one-liners.

Again, there is no law that says that casinos have to allow the dealers to keep all their tips. Your assumption seems to be that all the poker rooms around the country are just incredibly inefficient and run by people who won't take advantages of inefficiencies in the labor market. I disagree.

Okay. Can't really respond to a counter-assertion without an argument.

I've been following this thread for a few days.

I'll preface by saying that I'm a recreational player and generally tip $1 on any pot that gets to the flop, $2 if I win over $50 (not necessarily if the pot is $50), and $3 over $100. I've tipped as much as $10 on a $300 pot, but I was also friendly with the dealer.

I honestly do not like when others try to convince me to do one thing or the other. If you choose not to tip, that's your personal decision. You can certainly explain your rationale behind that decision, but do not try to impose your beliefs on me, be it religion, politics, or in this case, tipping.

On the flip side, some of the dealer reactions to non-tippers (or those they perceive to be "cheap" tippers) are a bit surprising. I have never withheld a tip, even if a dealer misread a board or was a bit slow, but I think I would if one had an outrageous reaction. On the more minor side, I didn't realize what dealers would do to non-tippers (such as pushing a pot without crunching, etc.), so that's something I'll keep an eye out for if there are non-tippers at the table (for entertainment value).

So, bottom line is...do what you want. It's your life, and if you feel comfortable not tipping, don't do it. If you like to tip, and it makes you feel better if you do, go ahead. I just wouldn't go around trying to impose my beliefs on anyone else. Then again, I guess by saying to do what you want, I kinda sorta am

This is correct. But, as I explained in earlier posts (search for mine in advanced search), the system will never change unless players collectively stop tipping (or the gov't intervenes - which I sure as hell am not advocating). These necessary "growing pains" will be temporary and for the greater overall benefit of the poker economy.

Dont understand all the hate. To be honest I dont think I ever tipped the dollar I said I would if they said no b/c the only ones that said no were dealers I really liked anyway. I didnt know that was so offensive to joke around at a poker table.

To say I am messing with someones livelihood is just absurd. They got extra money from me either way. But worse case scenario wouldve been the same tip they normally get from me.

This article asserts how "(the) cost in terms of relinquishing tipping as a service-quality monitoring device is likely to be miniscule," as well as how the tipping system, in general, is inefficient to the detriment of the economy and suboptimal in comparison w/ other systems.

The bolded part is a sticking point for me.
I am taxed on 100 % of everything i earn in tips and wage( i have ZERO problem with it). I believe every dealer in the state of Arizona works under the same pretense and therefore is not a fact that can be considered
across the board. What IS the standard in other states now?

Not trying to be a nit, but how would two players not tipping reduce tip income to $6/hr? Maybe I'm being too simplistic, but if we make some general assumptions that a $1/2 NL table is 10-handed, 6 players tip $1 if the pot gets to a flop, 2 tip $1 every pot, and 2 don't tip at all. For argument's sake, let's say 30 hands per hour, 15 hands get to the flop (low based on an average $1/2 game) and all players win an equal number of pots. That would be about $15/hr ($9 - 30 x 50% x 60% + $6 - 30 x 50% x 20% + $0 - 30 x 100% x 20%).