deadweight loss of christmas

Deadweight loss of Christmas: Economist explains why gifts are inefficient

Posted 1 year ago by Will Chen

Filed Under: Shopping

Christmas tree at Rockefeller centerDid you unwrap any crappy presents this morning? Are you thinking that all the shopping and running around was a big waste of time?

You might be right, says economist Joel Waldfogel.

Waldfogel estimates that people generally spend 16% more on presents than they’re worth to those who receive them. He calls this phenomenon “the deadweight loss of Christmas.”

For example, a deadweight loss is created when you spend $20 to give me a DVD that I would spend only $15 to buy for myself. Economist Tim Harford explains:

Continue reading "Deadweight loss of Christmas: Economist explains why gifts are inefficient"

Permalink | 12 comments

Have more to say? Join the discussions at Wise Bread's Finance and Frugality Forums.

Finance Blogs - Blog Top Sites