In Italy, there's really no tipping (it's built into the check, isn't expected and isnt' done), and the service isn't good. Tip's do induce better service.
I tried tipping once in Italy. The guy chased me down the street trying to give us our money back. I ended up taking it back because of the language barrier - I didn't know how to explain to him that it was for his excellent service, which it really was.
Anyways, I try to take into account how much server minimum wage is in the state that I'm in. In Michigan, the minimum wage for servers is lower than the standard for other jobs. Because of that, I will generally use 20% as my standard. Better service is rewarded appropriately, likewise poor service. When I go other places, I will generally use 15% as a standard. But if the bill is rather high, I use common sense. Recently, I went to a rib house with my family. After drinks and food for 6, the bill came to almost $150. I felt that a $20 tip was sufficient for the environment and the level of service, despite being lower than the "standard" 20%.
The last time I left nothing was about 4 months ago. Some friends and I were in a brewpub that happened to be rather busy that night. Now granted, the server was a bit busy, but on one occasion (amongst several) we tried to get the servers attention to refill our drinks. After three attempts, one of which she acknowledged, one member of our group literally stood up and waved his hands above his head to get her attention. She came over, and I swear she told us through a grimaced smile, said that waving down a waitress is a sure way to piss her off. I took that to mean that we pissed her off by trying repeatedly to get her attention. On a few more occasions, one of which was waiting to get our bill, we didn't even see our server for at least 5 minutes, despite how busy it was in the restaurant. We even asked a different server to get the manager for us so we could inform him of the server, and after waiting for 20 minutes, decided that was a waste of effort. I don't know who all left a tip, but I'm sure it was less than half of our party.
Other offenses of the night included: waiting more than fifteen minutes to get our drinks refilled - twice, not clearing appetizer plates from an already overcrowded table when our meals came out, attempting to remove my plate of food instead of bringing me the "to go" box that I asked for (others at the table recieved theirs). One member of our party called the restaurant the next day to file a complaint. And after talking to a couple people I know who frequent the place, I found out that the server had been fired from more than one place in town for poor service and frequent complaints. But I still go to the brewpub because that type of service is not the norm.