Looking for a reason to cut back on Christmas commercialism? Try reading Scroogenomics by Joel Waldfogel. I’ll bet you’ve never associated Christmas with the phrase “deadweight loss,” but economist Waldfogel wants to enlighten you in this treatise on wastefulness of holiday consumerism, particularly gift-giving. Waldfogel is not really a “bah humbug” sort of guy; he merely wants people to be more thoughtful about their gift-giving habits and avoid the misallocation of resources and that dreaded deadweight loss phenomenon, which is defined as a “loss to one party that is not offset by a benefit to another.” What that means in plain English is when you give a gift to someone for which they have no absolutely no desire or use, there is an economic loss of value for each party. Which happens more often than we would like to think -- hence, the re-gifting phenomenon. Waldfogel suggest the use of gift cards, which let the recipients choose for themselves, conserving value, or making a charitable donation in the recipient’s name, or just eliminating gift-giving entirely with those people who you really don’t know well enough to choose a gift they will value and enjoy. A sensible thought, and hardly Scrooge-like. For an interview with Waldfogel, visit FailureMagazine.
To find out more about me, click on the Not Your Average Jo tab.