"The Deadweight Loss of Christmas," published in American Economic Review (Joel Waldfogel, UMN) estimates that "on average, the waste attributable to poorly chosen seasonal gifts was between 15 and 20 per cent of the purchase price of the gift" ($10B/year in the US alone!).
After surveying his students about gifts they had received over the holiday season, he found that most gifts were poorly chosen relative to what the students would have selected themselves. Gifts from friends and lovers tended to be better chosen than gifts from elderly relatives but, on average, the waste attributable to poorly chosen seasonal gifts was between 15 and 20 per cent of the purchase price of the gift — that's well over $10bn wasted in the US alone every Christmas. This is a vast squandering of time, energy and valuable raw materials.
The usual response to this is that economists have, yet again, failed to appreciate the true meaning of Christmas. But to me this simply suggests that economists have managed to acquire a toxic brand in matters of human relations.
Were a priest to counsel against materialism at Christmas, nobody would accuse him or her of missing the point; the same message from an economist seems foolish and emotionally stunted.
You really, really, shouldn't have . . . [Tim Harford]
"The Deadweight Loss of Christmas [Joel Waldfogel/American Economic Review]
(Image: Rick&Brenda Beerhorst, CC-BY)
