Is cash the most ‘efficient’ Christmas gift?

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Some economists think that Christmas gift-giving is a big waste of resources, and that cash is a much more efficient present.

When giving specific gifts, people often get things they don’t want, which is a waste of resources.An estimate by Wharton Professor Joel Waldfogel suggests that 20 percent of gift giving money is wasted this way.

Woldfogel argues that a person who spends $100 on himself or herself will presumably spend that money on something that actually nets them $100 worth of satisfaction. But when another person spends that amount on a gift they may end up getting a painting of a cat for a dog-lover, a sweater in the wrong size, or a coffee maker for a tea drinker, etc.

Woldfogel argues it would be much more efficient to just give cash, so that the recipient can spend something that nets $100 worth of satisfaction.

Read More At TheWeek.com

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10 thoughts on “Is cash the most ‘efficient’ Christmas gift?

  1. No matter what other people say about how “cash is trash,” I believe cash is the best. Just try to sale your staffs anywhere and you’ll find it’s very difficult to make a sale to get some cash.

    When you have the cash you can buy anything thing you want. But if you try to exchange staffs or barter staffs, it’s very difficult (the big problem with hard assets.) I definitely prefer cash as gift. Or even gift card is better than staff because you can use it to get things you want, not other people want you to have.

    So give me some of your “Cash is Trash” to me. The more the better to me.

  2. As in earlier Azizonomics discussion of the economics of competing forms of energy, situational considerations dominate. Children prefer toys and surprises. There is usually a lot of child in grownup women. Choose accordingly!

  3. Cash may be efficient but human beings also get nourished by planning, shopping and anticipating the joy of exchanging chosen personalized gifts.

    The alternative would soon destroy the joy of giving.
    ( I want to give you $100 and you plan to give me $100. Lets not give each other anything )

  4. the whole thing abouts xmas is to show your beloved that you care. that you think of them. giving cash doesn’t achieve this. giving a mismatched gift is a “failed” try but it still has the notion of trying to think of them.

    ppl do not give gifts to fit, they do to show their affection.

    some stupid economists show resources are “wasted”. but this is misunderstanding. even movies abouts xmas for kids teach the whole thing is about human connections. stupid economists reduce human connections into “allocation dillema”. there is no dillema. a mismatched gift is still a good gift. because what is given is sign of affection. those folks are missing the point because they’re ingoring the human-cultural part.

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