339: Scroogenomics by Joel Waldfogel

by Gerard


339.47: Waldfogel, Joel. Scroogenomics: Why You Shouldn’t Buy Presents for the Holidays. Princeton, NJ: Princeton University Press, 2009. 146 pp. ISBN 978-0-691-14264-7.

Dewey Construction:

  • 300: Social Sciences
  • 330: Economics
  • 339: Macroeconomics and related topics
  • 339.4: Factors affecting income and wealth
  • 339.47: Consumption or spending

There are a lot of people out there who decry the wasteful spending by the developed world on the holidays. Joel Waldfogel is apparently one of them. In Scroogenomics, we hopes to convince readers to not buy presents for people for Christmas. Here’s why.

This book rests on three principles:

  • The money spent on a present by a giver is almost always greater than the value the receiver places on it. This creates a devaluation of goods and services across the board for holiday giving.
  • Giving cash comes with a certain stigma and, while it has perfect value to the receiver, it is not well received. Gift cards, however, have lost their stigma in recent years and are very well received.
  • A dollar for a less wealthy person has a higher perceived value than a dollar for a very wealthy person.

You can now see where the author is going with this. Waldfogel offers two solutions to decrease waste and increase value in one’s holiday giving:

  1. Give people charity gift cards that are loaded with money that they can then give the charity of their choosing. Apparently, people love giving to charity but do not always have the means to do so.
  2. Create a mechanism within retail gift cards that allow the tiny leftover balances to be given directly to charity by the retail establishment. For instance, you receive a $50 Target gift card, spend $47 on stuff you actually want or need, and the remaining $3 can immediately be directed to a worthy organization.

Waldfogel’s whole argument rests on the fact that gift receivers automatically undervalue items they get for Christmas. While, for some, that’s not the case, his point is still moderately interesting. This book is really just a conversation piece to gently push people to give to charity. There’s a lot of interesting economic principles and data in there, too, and I found that to be more interesting than his thesis. All in all, a quick but ultimately uninspiring book.