Why do I pay royalties? Where does that money go?

When an author writes a play, they don't receive a salary. Instead, royalties are how they are compensated for all of the hard work that goes into creating that play. Playwrights have the same expenses as everyone else: rent, food, medical bills, etc. Being able to earn money through the licensing of their plays allows playwrights to have time to create new work (as a profession and not simply a hobby) for you to perform. On a philosophical level, the payment of a royalty is a statement that a play is something of value, and acknowledges the time and effort that went into it. On a legal level, a play is wholly owned by its author(s), and failure to license your performance in advance and pay royalties (and purchase sufficient copies for the cast and crew) is copyright infringement, which is against the law both in the United States and abroad.