Your first sentence describes the intuition where if customers tip waiters more, companies will pay waiters less. I've actually heard that in many places, the

Your first sentence describes the intuition where if customers tip waiters more, companies will pay waiters less. I've actually heard that in many places, the customers actually tip enough that it goes beyond the ability of companies to pay less directly. So the waiters' pay actually does get pushed a lot higher. So high in fact that there's an disparity issue between front staff (waiters) and back staff (chefs), who actually get much worse because they're exposed to pure company pay.