Sep 08 2023

The Science of Gift Giving

There is a lot of social psychology out there providing information that can inform our everyday lives, and most people are completely unaware of the research. Richard Wiseman makes this point in his book, 59 Seconds – we actually have useful scientific information, and yet we also have a vast self-help industry giving advice that is completely disconnected from this evidence. The result is that popular culture is full of information that is simply wrong. It is also ironically true that it many social situations our instincts are also wrong, probably for complicated reasons.

Let’s consider gift-giving, for example. Culture and intuition provide several answers as to what constitutes a good gift, which we can define as the level of gratitude and resulting happiness on the part of the gift recipient. We can also consider a secondary, but probably most important, outcome – the effect on the relationship between the giver and receiver. There is also the secondary effect of the satisfaction of the gift giver, which depends largely on the gratitude expressed by the receiver.

When considering what makes a good gift, people tend to focus on a few variables, reinforced by cultural expectations – the gift should be a surprise, it should provoke a big reaction, it should be unique, and more expensive gifts should evoke more gratitude. But it turns out, none of these things are true.

A recent study, for example, tried to simulate prior expectations on gift giving and found no significant effect on gratitude. These kinds of studies are all constructs, but there is a pretty consistent signal in the research that surprise is not an important factor to gift-giving. In fact, it’s a setup for failure. The gift giver has raised expectations of gratitude because of the surprise factor, and is therefore likely to be disappointed. The gift-receiver is also less likely to experience happiness from receiving the gift if the surprise comes at the expense of not getting what they really want. You would be far better off just asking the person what they want, or giving them something you know that they want and value rather than rolling the dice with a surprise. To be clear, the surprise factor itself is not a negative, it’s just not really a positive and is a risk.

From an economic perspective, gift-giving is an irrational enterprise. The degree to which the gift receiver values the gift less than the cost, is lost economic value. The best you can do is break even by buying something the receiver would have bought for themselves if they could because to them it is worth the cost. But because gifts are generally not perfect, gift-giving in the aggregate represents lost economic value. From this perspective (which aligns with the receiver gratitude), the most important factor in gift giving is that the receiver actually values the gift. Ancillary factors like surprise, uniqueness, and expense don’t matter.

There is a caveat to expense – there is a minimum value that is considered socially acceptable to the gift-giving situation. Meeting that minimum is important to successful gift-giving. But going beyond that minimum add no further value in gratitude. And again – it’s a setup for gift-giving failure. If the giver goes beyond the accepted norms (given the overall social context) with resect to expense, their expectations of gratitude will rise accordingly. “I spent a lot on this gift, so they better appreciate it.” But the sincere reaction of the receiver does not depend on expense, beyond meeting the socially-appropriate minimum. So the reaction of the receiver is likely going to disappoint the giver, souring the entire experience.

What factors, then, should you focus on when buying a gift? Researcher generally recommend several things. First, make sure the gift is something the receiver wants. When in doubt, simply ask them. Gift cards and cash may also be appropriate, because it ensures the receiver gets what they want and they may enjoy the shopping experience you just facilitated. Gift registries are also useful. Don’t worry whether or not the gift is unique, or if you are giving the same gift to multiple people, or it’s someone you know the value of because you already own it. The only thing that matters is how useful it is to the person who receives it.

Consider long term utility and happiness over short term “wow” factor. People appreciate gifts more if they have lasting value to them.

Experience gifts tend to result in more happiness than objects. The experience can also be something you share together, reinforcing your relationship.

People do appreciate the thoughtfulness of a gift, because it shows you share something in common and you spent the time to think about them. You don’t have to overthink it, however. The most important thing is to avoid the negative of getting someone a gift they don’t truly want or can’t use. That shows you don’t know them well and didn’t take the time to make sure the gift was appropriate. You are far better off just asking them what they want or need rather than risk getting them something they don’t want, which can negatively impact the relationship. For a close relationship, paying attention to what people say and then filing it away for later gift-giving use is also a good idea. This can be a lot of work, but that’s actually the point.

This happens to be a situation where utility and emotion align. Going for the big dramatic gift – a surprise, unique, expensive gift with immediate wow factor – is a mistake. It’s a setup for disappointment, and these factors don’t actually increase gratitude or happiness. A thoughtful gift that has lasting utility and is valued by the recipient, even it if is mundane and of modest (but appropriate) expense, will maximize gratitude. This approach is also economically practical.

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