12.22.09

Scrooge was doing you a favor

Posted in Society at 17:55 by RjZ

Like I do every year, I opted out. I am not running around finding Christmas gifts for friends and family and, inspired by my stingy behavior in previous years, I can assume they are treating me the same. Like every other year, I read about the stress of struggling through shopping crowds and hear stories of stress from choosing, buying, wrapping presents and I am surprised how easily everyone forgot the economic collapse around us.

My family was nominally Jewish. Sometimes we celebrated Chanukah; sometimes we had a tree, decorated with blue and white, of course. I didn’t always get to open presents on Christmas morning, and looking back, not necessarily expecting anything worked out to be one of the best gifts I received. Today, I enjoy the relaxing, low stress time of year. So, with all the extra free time, I’ve given some thought to the holiday gift exchange frenzy that I thought I’d share.

Blame the feminists.

Alright, this is a stretch, but hear me out. Back not so long ago, people used to get gifts of what they needed, but that’s changed. Few children are receiving a new bicycle for Christmas this year. If they need a bike, they’ve already got one. Christmas gifts are more expensive, but can’t be spoiled by ‘need’; gifts ought to be what you want!

I think it all started with my mother. Like many women in the Feminine Mystique age, she grew tired of getting mixers and irons and vacuum cleaners for the holidays. Rightfully, my mother pointed out that a new vacuum was a gift for the house and not for her. Arguably, she was the one who was going to do the vacuuming, so any tool that could make that job easier would clearly benefit her, but this wasn’t an argument my father was willing to make. Smart man. Not alone in that conclusion, I think.

The idea caught on, and pretty soon nobody was getting new ties and shoes. Those weren’t considered gifts, but rather necessities. Nobody wants a new vacuum cleaner or dress shirt, even if they need one. As long as we have enough money (or, apparently, can borrow it) people want things that they wouldn’t think to buy for themselves.

The perfect gift

I am not anti-sentimentalist. I understand that people enjoy giving and receiving gifts. For example, I think the perfect gift is something that you didn’t even know that you wanted, yet shows that the person who selected it really understands you and cares about you. There’s no need for it to be expensive or even practical. Often families aspire to get a person on their list a gift of something they would like, but wouldn’t likely buy for themselves. It’s almost the same thing and a lovely strategy, but it still leads to gifts of things that I didn’t value enough to save up for, but still wound up having. Maybe I didn’t need that blu-ray player so much after all?

In his now (in)famous article, Wharton School professor of business Joel “scrooge” Waldfogel puts a value on “The Deadweight Cost of Christmas.” He estimates about 10 – 30% lost value of the gift. In other words, even if you really needed a sweater and your auntie bought you one, it still might not be exactly the one you would pick out on your own. Of course Dr. Waldfogel doesn’t put an economic value on the sentimental value of gifts, but then again he doesn’t put any value on time it takes to take an ill fitting pair of socks back to the store for an exchange. Nor does he put a value spending money you didn’t have to get something that’s not quite as desirable (or even downright ridiculous) as what you might have spent the money on yourself.

What to get for the person who has everything?

We face this challenge more often since society encourages us to fulfill desires instead of identifying a needs in our loved ones and friends. People with sufficient resources already have an iPod or a digital camera. I’ve already hinted at how difficult it is to buy clothing that is perfectly to someone’s taste and actually fits.

I did a brief survey at work of how many men buy sexy lingerie for their significant other. The enticing idea just doesn’t work. Women who don’t actually share the measurements of Victoria Secret models can barely find lingerie that fits and flatters all by themselves. Armed only with a size and imagination, the men I interviewed seemed to have realized, by their almost unanimous, and singular attempts, that buying what they thought would be awesome is a bad idea at best.

If the goal is get something someone really wants, we risk getting something they quite likely already have, or perhaps something just too expensive to justify. Families who try to overcome this problem by pooling resources are faced with far greater risk in gift giving. Buying a trinket that isn’t exactly what you brother wished for isn’t perfect, but at least it has relatively little deadweight cost. Buying a GPS receiver with just the right features is much harder to figure out, and the cost for failure is greater.

Fine, that’s where gift cards come in. Yet, even here, there is deadweight cost. If I am on my way to Best Buy anyway, there is little downside, but if the object of my desire is not available, or I’ve found it cheaper at REI, my choices have been needlessly limited. Of course, the ultimate gift card, cash, might work. Except, of course, exchanging cash would be pointless, wouldn’t it? It certainly doesn’t do a very nice job meeting the sentimental value of gift giving.

Deadweight cost isn’t a problem of wealthy and privileged alone. The less you have the greater the impact of deadweight cost. The disadvantaged child will likely appreciate even simple gifts. Of course, people suffering through these hard times can really use the change an unneeded gift brings beyond just the necessities. Yet, taken to the extreme, a starving child can’t eat a doll.

Unintended obligation

Suppose I decide, solely from the kindness of my heart and honestly with no expectation of anything in return, to buy you a gift, say, a game for your new PlayStation 3? It’s a nice gift, not too expensive, and might be something you really want. Where’s the cost here? No matter how sincere I was in expecting nothing in return, I bet you’re a nice enough person. While playing that game later, you’ll get to thinking ‘wow, that was nice. You know, I really ought to get him something!’ Come on, you feel obligated. You may not be annoyed by my gift and exchanging them will probably improve our friendship with all the warm feelings we get from thinking of the nice gifts we got, but you’re still out there paying for this new game with your time and money, and if you really wanted Final Fantasy 13 you probably would have just bought it.

Even in the best case scenario, a stronger friendship and a great new game, you’re now out buying something for me that you didn’t intend to. Indeed, I don’t really need it, I wasn’t kidding when I said there were no expectations, and yet, my selfless act has created extra work and stress for you—that’s the opposite of what I intended, but there is almost no way around it.

Imagine there were no gifts

If folks really do love the carols and cheer, if the holidays are really is about family and friends, why don’t more of them join me? There are plenty of stories of families opting out this year, just like I do, although many of them are about how angry the rest of the family was at ruining their fun. I hope they can still find some joy in it as I do. If the spirit of Christmas really is about creating memories together, then do it. Make your own decorations for the tree. Light the Channukah candles together. Eat. Go for a hike together. Write each other a poem. Read a story. Turns out being stingy can increase value for everyone. The absolute deadweight cost is decreased, but the joy and warmth of each other is hardly diminished. Do you really need a new 46” flatscreen LCD with 3 HDMI inputs, internet access and 10000:1 contrast to make this time of year complete?

Note: this article is not a veiled gift list. Really.

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