Taking chances with dinner

Splitting up restaurant bills is annoying.

Good friends often avoid this cost by one of them paying for both one time and the other doing it next time, or better yet, by not keeping track of whose turn it is and it evening out in the long term.

Coins before Euro - European Coins In Circulation

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It’s harder to do this with lesser friends and non-friends who one doesn’t anticipate many meals with because one expects to be exploited by a continual stream of free-riders who never offer to pay, or to have to always pay to show everyone that you are not one of those free-riders, or some other annoying equilibrium.

There is an easy way around this. Flip a coin. Whoever loses pays the whole bill.

Why don’t people do this?

Here are some possible reasons, partly inspired by conversations with friends:

 They don’t think of it

Coins have been around a long time.

It’s hard to have a coin that both people agree is random

One person flips and the other calls it?

They are risk averse

Meals are a relatively small cost that people pay extremely often. They should expect a pretty fair distribution in the long run. If the concern is having to pay for fifty people at once when your income is not huge, either restrict the practice to smaller groups or keep the option of opting out open.

Using a randomising method such as a coin displays distrust, which is rude, but not using one would be costly because you don’t actually trust people

A coin could also display your own intention to be fair. And it doesn’t seem like such a big signal of distrust – I would not be offended if someone offered this deal.

Buying meals for others is a friendly and meaningful gesture – being forced to do it upon losing a bet sullies that ideal somehow

Maybe – I don’t know how this would work

Asking makes you look weird

This is an all purpose reason for not doing anything differently. But sometimes people do change social norms – what was special about those times?

Sharing in the bill feels like contributing to something alongside others, which is a better feeling than paying all of it against your will, or than not contributing at all.

Maybe – I feel pretty indifferent about the whole emotional experience personally.

There are many inconvenient small payments that seem like they could be improved by paying a larger amount occasionally with some small probability. Yet I haven’t seen such a method put to use anywhere.

21 responses to “Taking chances with dinner

  1. I’ve been doing this for a while now, and I actually find it plays pretty well with my more rational friends — we get quite a kick out of it.

    One of the drawbacks to using a coin is that it creates a moral hazard, incentivizing people to order more than 50% of the total bill. We solve this problem by using http://www.random.org/ from a smart phone. Say the total bill (pre-tax, pre-tip) is $30, $17 for my portion of the meal and $13 for my friend. We then generate a random integer between 1 and 30 inclusive, and if it lands anywhere between 1 and 17, I pay the entire bill (+tax, +tip); otherwise, my friend pays.

    One bylaw of this ‘game’ is that you’re not allowed to thank the person who pays, because they haven’t done you any favors. It’s actually pretty hard though — you have to bite your tongue, because all of your instincts say you should thank the person who pays for your meal :).

    • I have a friend who routinely did this, and one reason why I didn’t adopt the practice myself after learning about it is the moral hazard issue you discuss. I like your solution.

      However, the “moral hazard” is often a feature rather than a bug–you may explicitly want to spend lavishly on dinners with friends to create interesting memories, and reducing your responsibility for your own part of the bill to 50% is a very reasonable way to accomplish this while still deterring you from going completely nuts.

  2. A request to randomize payments is a way of challenging the other meal participants into revealing whether or not they’re liquidity-constrained in the short run. Anyone who is in a tight budget or has no credit is then forced to either risk overstretching themselves or opt out and reveal that they’re poor.

    Empirically speaking, this is already done fairly often and goes by the name of “credit card roulette.” It was a fairly common way of showing off both resources and risk appetite among young workers on Wall Street.

    If someone asked to do this for a meal I was partaking in, I would view them as rude and unaware of the class/income privilege that allows them to do this without personal risk.

  3. > There are many inconvenient small payments that seem like they could be improved by paying a larger amount occasionally with some small probability. Yet I haven’t seen such a method put to use anywhere.

    I’ve tried this on IRC. Help someone with technical problems and in exchange, they ‘roll a dice’ (using random.org or lambdabot in the channel) and with 1/1000 probability etc donate to SIAI or Debian. Only 3 or 4 people have ever taken me up on it, and I have no idea if they would have followed through.

  4. This meal splitting thing is the most annoying thing about a dear friend of mine. She always insists on paying for her part but you know, sometimes I want to treat her. She’s done me favors, I’m the one who invited her, I’ve ordered wine or appetizers without consulting her budget so I don’t think she should be on the hook for that. I’ve told her that sometimes the most gracious thing to do is to accept (the other party is doing this for themselves not you) so it sucks some of the joy out of it. And of course, she always has to pay more than her share and won’t take any of it back. I’ve given up.

    After seven years of this, she wins. I just take what she gives me and don’t say anything. My only solution to this problem is acceptance…

  5. I like Kevin’s way.

    I’d like to see stores doing the same for non-whole-dollar amounts.

  6. I have long believed that this method of payment would be very useful for paying bus fares. The buses where I live already have several kinds of complicated machine at the front.

  7. I guess in my own case I generally don’t want to have to bean count with respect to the people I’ve chosen to trust. It’s effort. I think also I don’t want to be seen as a been counter… someone who nitpicks about everything being absolutely fair. I suppose such a stance could signal stinginess, and therefore a lack of wealth… or something like that.

    This method seems to ameliorate my first complaint to some degree since you would rely on chance to provide a fair result over the long term. Not too much effort really. However, it may produce results outside the norm in the short term. And that might upset people who think the fairness should be more immediate.

    With respect to my second complaint – I find it interesting that while I think insisting on a coin toss probably would signal stinginess to others, insisting on splitting the bill doesn’t worry me. I can’t think of a good explanation for that.

  8. It depends on what kind of friends you are having dinner with. It is always getting super complicated when involving money into any interpersonal relations, not just between friends. It is best to make things clear for money issues in case to avoid any awkwardness (that is, either you feel uncomfortable for paying for the free rider or being the free rider owing a favor). Either way, it’s a very unwise to leave it to the probability of coin flipping to decide who’s paying. It’s always better to clear money issues among friends. Unless, of course, you don’t care much money and willing to take care everyone else. Just because you don’t care it doesn’t mean others think alike. That’s a cognitive bias there.

  9. This is super common amongst poker players. Google “credit card roulette.”

  10. The person who tends to order cheaper meals loses out compared to the split-the-bill arrangement.

  11. I talked about it at the Paris Lesswrong meetup. It’s risk aversion.

    You’re conflating regular meals (small cost, paid extremely often) and eating out (cost larger by a factor of about 5, paid much more rarely). Most people’s finances make them much more averse to big rare expenses than to small frequent ones, for obvious reasons. (Overdraft fees are huge.)

  12. Like several others have mentioned, there is a well known game, popular in Wall Street circles, called credit card roulette.

    It should be said though that the level of risk aversion is not just about the cost of the meal. Let’s say that you weekly dine out with 4 people and the cost of your meal if $50. You have a 0.1% chance of paying $2000 extra in a given year. A lot of people are risk averse at that level (e.g. car and medical insurance rarely has annual deductibles that high).

  13. Engineers don’t do this nonsense. We put in for our own orders, plus tax and tip. If all we have is plastic it’s easy enough to write names and amounts on the back of the bill and hand over multiple cards. I’m frankly astounded that anyone does it any other way.

  14. it all depends on with whom you have dinner, friends or a date.right now I’m dating a woman older (longer career) than me and we have no trouble at all splitting the bill, specially if it is a $100+ bill.

    and…I’m inclined to believe it is something around the last idea you mentioned: “Sharing in the bill feels like contributing to something alongside others, which is a better feeling than paying all of it against your will, or than not contributing at all.” It just feels good to cooperate. I buy the goods & staples and cook, you buy tasty wine and chocolates, and we get an special dinner.

    maybe this suggestion only applies to same age/mindset couples or really good friends who want to signal their smartness to other people.

    @haggard: bean-counting means “lack of wealth”? you can afford to act like a bean counter if you have an stable career, pick up your date in a $40K+ car and live in a nice apartment (AKA being an smartass). people who needs to signal generosity or wealth is precisely because they are not thaaaaat wealthy. countersignaling? =)

    @noah: you’re right, you ask a piece of paper and write down the amount to charge to every card, what’s the problem with that? i don’t know, i do it everytime i go to the local brewery with my friends.

  15. I bet you’ll find that on most occasions we don’t really want randomness. Both sides will ‘offer’ to pay and there is a bit of randomness, but the coin is weighted in favour of one side which can/should pay. We don’t want to acknowledge that so ostensibly who pays is random.

    This approach would also ruin the pretense of ‘wanting’ to pay because you care about the other person.

  16. Letting a coin pick who picks up the tab means that people give up control – over the transaction, over who is treating who, over the [small] amount of money that is the cost of a meal. People prefer to be in control – unless they are gamblers, but that’s a minority – and to own the decision who pays for dinner.

  17. Ditto to Noah. Pay for your own order! That should be the default. If someone decides to pay for someone else, that’s a special gift, not a standard practice.

    It’s really not annoying at all for everyone to just pay for their own.

  18. Why is this even an issue? 15 or 20 years ago, restaurants seemed to frown on bringing separate checks. But technology has advanced. These days, how do you even find a restaurant that can’t ring up separate checks in a flash?

  19. people in the lower traditional cultures would think this extremely insulting and might throw you out of the window
    while for people of the northerno-western euro extraction that use more of the high brain it is more acceptable

    it signifies a cold brain

  20. I used to think that splitting bills was easy enough that such an elaborate scheme (it has to be a bit elaborate to avoid the moral hazard problems) made absolutely no sense. But I started to use it and it seems reasonable. I think the biggest advantages may come in group settings. At a 10 person meal I often find it too hard to coordinate with the whole group, but it is easy to flip a coin with the person next to me. Then only one of us has to deal with the coordination problem.

    I do find the signaling issue jplewicke refers to troubling, and it is my main concern with proposing this more often. Though for tabs < $100 you would have to be liquidity constrained over a very short time period for this to matter (someone who is much poorer will also justifiably need to think harder before concluding this anyway, which raises the same problems, and some people are that liquidity constrained or would need to shuffle around money). Also note that the existence of some signaling difficulties (like this and the one aristogeit mentions) unfortunately guarantee that the entire thing is going to end up being significant as a signaling exercise, even with crowds who you know to be rational and wealthy enough to bear the risk. Finally, note that such randomization can make it more annoying for someone to track finances. So I think there are a lot of reasons not to do this, notwithstanding its convenience.

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