As a dual national, American and Dutch, I come from both sides, whereby in the USA of course it is second nature to tip for good service, and actually, in many cases, to tip even for mediocre or poor service. In the Netherlands, service is included, although there I likewise always tip if the service is good. Most companies I have worked for would accept tips on my expense account for trips to the USA, whether on my CC to a max 20% of the bill, or cash up to USD $50 without receipt. I am not sure what the norm is, but I had this with most.
As to rationale, the United States operates very much on a two tiered minimum wage, where what I would call the HORECA industry (mainly F&B driven jobs) are at the lower wage as it is known and therefore expected that these employees will be tipped. So of course, when an employee is earning a far lower wage, living off of tips, doesn’t receive a tip due to a client not understanding this situation, it has an adverse effect on that server.
Whether one agrees with this or not is to each their own, but this is the reason tips are expected in the USA. Does it for the most part, encourage better service, I think most would say yes when compared to a number of western European countries where service is included, and therefore the server really cant be bothered either way. Not wanting to generalize of course as I have had great service in France and Belgium on occasion where service is included, and appalling service on rare occasion in the USA, but for the most part, the service culture in the USA is quite good.
unfortunately I do feel the tipping situation has gotten way out of hand, especially in cities such as New York, where leaving 15% is now looked down upon and 20 to 25% is the expected norm, which to me is just ridiculous. I also hate countries that say Service is included, but the staff never see it even if it is a line item on the bill. I have been known to cross that line off if the service was not up to scratch, or if I wanted instead to leave a cash tip to the server thereby ensuring the server gets the tip.
I hate being made to feel guilty, cheap, rude, or at fault, and have learned to adjust to what the norm is in the country I am in.