Tag: inefficiency

Zelle — Birthday Gifts

From an economic perspective, giving the wrong gift makes society poorer. If you spend money on chocolates and give it to someone who happens to think it is worth less (due to an allergy!), you’ve lost value. Whenever you receive an outfit that is the wrong size or style, a candy you won’t eat, or something that is worth less to you than what the gift giver spent on it, an economic inefficiency has occurred. Thus, from an economic perspective, the most efficient gift is always cash. The person will maximize their own utility by spending (or saving) the money according to their preferences.

Submission and description from Erin Yetter!

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Superstore — Gift Wrapping

 

Garrett is on gift wrapping duty at the store and he hides his inability to wrap gifts under the guise that it’s inefficient. While economists may see gift giving, in general, as inefficient, gift giving inefficiencies are scattered throughout television and movies (Blackish, Brooklyn 99, John Mulaney’s Stand Up, Life in Pieces, and Old School). In this scene, Garrett focuses on the wasted time that it takes, beyond just getting the gift, that goes into wrapping a gift only for the wrapping to be destroyed later.

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Life in Pieces — Thank You Cards

 

Colleen and Matt are back from their wedding, but they haven’t written any thank you cards. Joan tries to drop hints by buying them thank you cards, but now she’s gotten to the point of just telling them they need to write thank you cards. Colleen realizes they need to do this because they want gifts later for their baby shower. This self-interest has sparked an idea! While it may be fair to write each person an individual card, Colleen and Matt realize it’s much more efficient to make a thank you video that people can share. The gesture isn’t well received at brunch. Often, improvements in efficiency (in this case making a video and saving the couple time) come at the cost of equity (many family members feel this isn’t fair).

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Life in Pieces — Garage Sale of Gifts

 

Heather and Jen complain to Greg about all the awful gifts that they have received from Joan over the years. They realize this is the time to sell the items at a garage sale, but they can’t sell the stuff at Joan’s garage sell. They decide to host a simultaneous garage sale that focuses only on the bad gifts that they have received. This is a good example to show that the value Joan paid for the gifts will be much higher than the price Heather and Jen could expect to receive from a garage sale, which can be used to show the loss in economic surplus from this exchange.

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Life in Pieces — The Stress of Regifting

 

Joan tries to give Jen and Greg a gift certificate for a couples massage because of how stressed they are. It turns out that Greg and Jen had already given her that gift certificate and caught her in the act of regifting the item. Joan claims they didn’t really need it because they were never really stressed so it was better to just give it back. One of the transactional issues of gift giving is that it’s hard to know exactly what the other person values, which creates losses in surplus.

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John Mulaney — An XXL Shirt

 

 

John receives an XXL shirt as a child, which was pretty useless to him. His mom suggests that he use it as a sleep shirt, but he really wants to make a comment to the person who gave him the gift. His mom explains that it’s rude to make comments about people who give your gifts, but John is quick to notice that the inefficiencies of receiving gifts that aren’t really usable.

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Ebay — 12 Days Commercial

 

One of the tough parts of buying Christmas gifts is that we don’t have perfect information regarding what the other person really wants. This issue often leads to us buying gifts for people based on what we think they’d like. This commercial from eBay points out that you can find a variety of gifts that someone would put on their list are low prices if you shop on eBay.

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