Stories | December 1, 2009

Is Christmas a time for giving?

An economist gives a different take on Christmas gift giving.

Economist and university professor Joel Waldfogel's book Scroogenomics: Why You Shouldn't Buy Presents for the Holidays, was released just in time for Christmas 2009.

How much did you spend?
Waldfogel crunches the numbers on how much shoppers spend on presents and how much the recipients thought the gifts cost. Perhaps surprisingly, the receivers underestimated the amount spent, on average, by 20%. Waldfogel has claimed one-fifth of the gift spend "is effectively flushed down the toilet".

Give me what I want...
One way around this could be to give cash or gift cards. Studies have shown that more people like to receive cash as a present than to give it. The author reckons that to get the biggest bang for the buck, gift givers should ask the recipient what they want and provide accordingly.
The Enlightened Economist, by noted economist Diane Coyle, reviews the book on this website.

eZonomics team
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