A Blog by Jonathan Low


Dec 25, 2018

If Economists Wrote Christmas Cards

It's a dilemma. You want to do something appropriate for the holidays, especially for those who have value to you. Defining that value is certainly the first order of business, but then, given the variables in the consideration set, do you go macro or micro?

Being a professional in any craft or art presents challenges at the end of the year when people expect your actions and choices to be a signal. This can  devolve into self-parody, but when has that stopped anyone from Milton Friedman to Larry Summers? So, try to take a more macro view: have a Merry Christmas, a Happy New Year - but not before putting your graduate assistants to work on defining the longer term meanings of both 'merry' and 'happy. JL  

Derek Thompson reports in The Atlantic:


"In some cases," Steven Kaplan said, in a stirring defense for thoughtful gifts, "non-pecuniary [not cash-related] values are important."
Cash is the most efficient gift, according to economists. Cash is also a terrible gift, according to economistsBy guaranteeing that the recipient can buy exactly what she wants, you guarantee that the recipient will consider you an unemotional robot.
That's why the vast majority of economists in the University of Chicago's IGM poll said it's absurd to give cash to loved ones for the holidays.
Non-pecuniary values are important! I guess so. But can you imagine a more wooden explication of love? Can you imagine a more wooden explanation of anything? Just think of the Christmas card...

And it got me thinking. Could you design an entire set of Christmas cards from these famous economists' actual quotes to the University of Chicago? Might it make the perfect new line of season's greetings from Hallmark? Why yes, it really could.
"Cash is more efficient in a narrow sense, but holiday gift exchanges are about interpersonal relationships," Joseph Altonji explained, in a card that would be perfect for, say, coaxing your long-withdrawn uncle back home for a family reunion.

Princeton's Janet Currie offered an eloquent defense of non-cash presents serving "many functions such as signalling regard," which would make a great card for dissatisfied gift-receivers. Let's say: A Florida girl, passive-aggressively imploring her grandparents to stop buying Christmas sweaters that are useless in 80-degree weather...

... I don't know a lovelier way to troll a grandmother.
Stanford's Pete Klenow's pithy explanation that "a costly signal can be worthwhile" makes the perfect card for a long-term girlfriend not-so-subtly suggesting her man buy the damn ring, already.

Zales just found its new slogan. Unless Kay steals it first. Every kiss, after all, begins with a costly signal.


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