The road to Spyhill

Economists have a sort of half-joke, inspired by Yale’s Joel Waldfogel, about the “deadweight loss of Christmas”. Every year we humans race around, spending, collectively, billions of dollars trying to find noncash items that other people in our lives will like. But we are less than perfect at intuiting the preferences of others, and it is the rare recipient who will value what he receives from everybody as much as he would what he could buy himself with the cash equivalent. The total worth of the gifts exchanged at Christmas thus inevitably ends up being smaller than the amount spent. Viewed this way—and it’s obviously not an unreasonable way—Christmas is a giant global potlatch, an orgy of value destruction.