I read on MSN that tips stands for something like "thanks in-advance for proper service" and that the word/gesture isn't used the same way back then, as it is today.
It's just customery, i used to work as a waiter, and was told that despite my low wages, i could expect probally 100 dollars a night from tips. So rather than pursuing a higher paying job, I took that job and did make a good amount of money in tips. The restuarant pays me to tell them what the customer wants, and to take that food to the customer. The customer tips me to ensure that the restuarant gets their order right, provide them with any service they need, and to make sure their dining expirience is as enjoyable as possible.
I tip knowing what's it like to be on the other end. The lure of a lot of service jobs is "hey, though we're actually paying you less than minimum wage, you'll be making a lot more money because you're money will be in tips".
I work as a paint-store employee now (along with being a student) and though i don't expect to get tip'd as i'm well compensated from the company, i know that the contractors who regularly come to the store are likely to tip me, offer me free drinks, smokes, beer, etc, since they want to build a repore with me and create a relationship ensuring that they know someone who can take care of them when they'll need a big order made.