I think the "gift" idea breaks down in practice when tips have become common and expected, instead of rare and meaningful. It leads to moral hazard where the es

I think the "gift" idea breaks down in practice when tips have become common and expected, instead of rare and meaningful. It leads to moral hazard where the establishment rationally gives up its responsibility of paying its hired staff. "Tips as gifts" does work in situations where there is no establishment. For example, musicians on the street with a tip jar.