Law and Economic Analysis of Service Charge in Restaurants

The levy of service charge in India is at present highly contented, which has led to a war ofwords among various authorities of the country.

y. This paperinvestigatesthree scenarios through an economical lens and within the boundaries of the consumer rights. The pros of the three scenarios are then weighed against its cons to reach a final recommendation of the study which in turn also proves all the three scenarios which are contended in the country at present as economically inefficient. The findings of the study show that the first scenario of tipping is proved inefficient asIndia does not have a strong tipping culture leading to undertipping, along with that tips are only realised to the front-end workers and not the back-end workers or the cleaning staff.

Recommended Citation

Niharika Agarwal and Diya Parikh (2025) "Law and Economic Analysis of Service Charge in Restaurants ", GNLU Journal of Law And Economics : Volume VI 2023, Issue I
Available at: https://gnlu.ac.in/GJLE/Publications/Law and Economic Analysis of Service Charge in Restaurants