"When the Giving is Good: Saving Christmas from the Economists," Weekly Standard, 14 Jan 2008.

Excerpt:

The wrappings are off and the Christmas gifts stand exposed to the light of day. Did you get what you wanted? Christmas is under attack not only for materialism, not only for multicultural failure, but now also for lack of utility. Economists as ambitious as they are cagey–perhaps bored with economics in its usual confines–have become critical of the frenzy of Christmas gift-making. The gist of what they say: Christmas is a highly inefficient way of connecting consumers with goods.

That confident description of Christmas, full of boyish impudence and gleeful irreverence, tells us something about the nature of economics. It could not have been given if we as a people were not devoted to economics, more so than to what is sacred in Christmas. But still such thinking makes us decidedly uneasy.

Now, if we can look at Christmas from the standpoint of economics, why not look at economics from the standpoint of Christmas?

Economic analysis says that consumers would be better off making their own purchases, buying things they know they want, rather than trying to get the benefit out of gifts bought ignorantly for them by others. Worse than ignorance is the imposition of the giver’s own taste or views, as when a conservative woman I know kept giving her liberal sister the gift of a subscription to a magazine her sister did not want to read. Christmas offers compelling opportunity to the human temptation to improve one’s friends and relatives. As for the economy as a whole, the analysis continues, it would be better off without the surge in sales of Christmas gifts at the end of the year, if only businesses could be sure that the same sales would be spread out more evenly. Thus, however nice it is to receive presents, it is against the general utility that we feel compelled to give them at one time.

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