It’s the most wonderful time of the year, according to Andy Williams. And though that classic Christmas lyric doesn’t end with for consumption, it is undoubtedly a wonderful time for that, too. But that doesn’t mean the benefits of holiday spending outweigh the costs. Are your hours in the kitchen, at the mall, and on the road well spent, from an economist’s perspective? The Initiative on Global Markets at Chicago Booth ran an Economic Experts Panel poll on the question.
Do leading economists think that all the spending—on parties, gift giving, and traveling—provides a social net benefit? Eric Maskin of Harvard says “it would be Scrooge-like to suggest otherwise,” and half of the panelists agreed or strongly agreed that the spending is beneficial. Nonetheless, about a quarter were uncertain or didn’t answer, and 10 percent disagree. Here’s what both sides had to say.
Like Maskin, Larry Samuelson of Yale agreed: “Despite curmudgeonly economics articles, the revealed preference is that people derive gains from these activities.”
Carl Shapiro of Berkeley also agreed: “Don’t let an overly narrow view of benefits and costs ruin your holiday cheer.”
Judith Chevalier of Yale disagreed, citing too much good food: “[It] contributes to the obesity epidemic for sure.”
Aaron Edlin of Berkeley also disagreed: “There is a difference between saying the holiday season confers net social benefits and that all the spending does.”
Oliver Hart of Harvard was uncertain: “There seems to be a social need for public celebrations and gifts. But some are forced to participate. The net benefit is unclear.”