The BBC World Service interviewed Joel Waldfogel today on its Newshour program. His latest book is Scroogenomics: Why You Shouldn’t Buy Presents for the Holidays.
Waldfogel notes the following:
On average, people value the items they receive as gifts 20% less per [British] pound spent than the items they purchase for themselves.
While I am a HUGE fan of gifts, the research apparently bears out that there is an experience of increased value when we get what we truly want when we are the ones paying a price for it.
It reminds me of the British poet, William Ernest Henley, who wrote in his famous poem, Invictus:
I am the master of my fate:
I am the captain of my soul
To be so responsible for getting what we want is costly, yes. And while I’d argue that in the personal realm, the ROI is actually much higher, being responsible for your life will likely mean you’ll value your experience, goals and fate with a minimum of a 20% increase. Now isn’t that a good reason to be a Scrooge!
Jen, I had a related but slightly different thought on this topic of gift-giving. In my family, not having a gift for someone causes all kinds of strife: not only may the potential recipient be insulted if you don’t have a gift for them, but others will be insulted for them. For example, it means a lot to Mom that I have something for Grandma, and so forth. In other words, having *something* for everyone is a rudimentary way of keeping family peace during the holidays.
So the greatest source of anxiety about gift-giving is actually last-minute gift-buying or gift-making, which could be alleviated by advance planning and frequent reassuring myself that I basically already have something for most people that require a gift. Kinda like knowing the suit fits before going to the black-tie gala.
In yet other words: accept the fact that there are just certain things one needs to do to fit into one’s family’s Christmas culture. We could coach around this for hours, or just go to the Italian Market and buy a little something for everybody and fully relax when the celebration ensues.
Hi, Jen! I heard Waldfogel’s interview, and I don’t think his point was that we value things more when we pay for them, as opposed to receiving them as gifts, simply because we paid for them. I believe he was saying that we are just less likely to be happy with the things we receive as gifts than with the things we purchase for ourselves, only because we know ourselves better and are therefore about 20% more likely than other people to buy the right thing for ourselves.
Kilian – I appreciate your reflection on family custom and expectation and the subsequent effect it has on us. Of particular note to me is your last point about working through the issue v. just getting on with it. Many times we forget that it may be just as valuable to fulfill the expectation and decrease our own anxiety.
Thanks for posting!
Dad – Indeed you are right about Waldfogel’s point and in re-listening to the interview, I see that I misconstrued it.
I would argue, however, that the point I make is also correct. Not only are we more likely to give ourselves what we actually want but when we pay for it, we are likely to value it more. While this is not always true, I find it to be often so.
I haven’t read Waldfogel’s book and I’d be curious to know if he addresses this, too (perhaps in the chapter Spending and Satisfaction).
Yes, I certainly agree about the larger point you were making, Jen: how taking responsibility for our choices increases the value we place on our experiences and endeavors. Then too, there are so many different ways in which to value things beyond their economic worth. The value of a gift lies at least partially in the relationship from which it springs and that it represents how the giver was holding you in mind. The value of a purchase, on the other hand, is pretty much limited to such things as status, utility, beauty. But the purchase also represents personal choice and control, and as such provides an excellent metaphor for personal responsibility!
Dad – I think you should be a philosopher in a more formal way.