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Episode: What is the purpose of giving gifts?

Author: Plain English
Duration: 00:22:38

Episode Shownotes

Today's story: Giving gifts is a waste of money. That's the conclusion of economic studies that show the ""deadweight loss"" that occurs when givers buy gifts the receivers don't want very much. But even with this loss, a good gift can still be worth it...if done right.Full lesson: https://plainenglish.com/737 --Upgrade

all your skills in English: Plain English is the best current-events podcast for learning English.You might be learning English to improve your career, enjoy music and movies, connect with family abroad, or even prepare for an international move. Whatever your reason, we'll help you achieve your goals in English.How it works: Listen to a new story every Monday and Thursday. They're all about current events, trending topics, and what's going on in the world. Get exposure to new words and ideas that you otherwise might not have heard in English.The audio moves at a speed that's right for intermediate English learners: just a little slower than full native speed. You'll improve your English listening, learn new words, and have fun thinking in English.--Did you like this episode? You'll love the full Plain English experience. Join today and unlock the fast (native-speed) version of this episode, translations in the transcripts, how-to video lessons, live conversation calls, and more. Tap/click: PlainEnglish.com/joinHere's where else you can find us: Instagram | YouTube | WhatsApp | EmailMentioned in this episode:Practice what you learn (and get human feedback)Don't just listen to the expression: put it into practice! Every time you learn an expression at Plain English, write your own example using that expression. And then an expert English speaker will read your example and give you personal feedback on how to improve. Sign up for a free 14-day trial at PlainEnglish.com

Full Transcript

00:00:01 Speaker_00
Bah humbug, giving gifts is a waste of money, but you should do it anyway. Hi everyone, it's Jeff and this is Plain English where we help you upgrade your English with stories about current events and trending topics.

00:00:19 Speaker_00
It's beginning to look a lot like Christmas. It's Thursday, December 19th, 2024, and there are just a few days left until the biggest gift-giving holiday in many cultures. Christmas Day is on Wednesday.

00:00:38 Speaker_00
And that morning, a lot of kids and adults will unwrap presents and see not what they wanted, not what they would have gotten for themselves.

00:00:53 Speaker_00
Giving gifts during the winter holidays or at any other time of the year comes with the risk that the recipient won't like what you've selected. So how do you navigate that? That's what you'll hear about in today's story.

00:01:13 Speaker_00
By the way, this is the last new episode of the year. For the next two weeks, we'll bring some older lessons up to the top of your podcast feed to enjoy for the rest of the year.

00:01:29 Speaker_00
In the second half of today's episode, you'll learn the English expression, down the line. This is episode number 737, so you can find the transcripts, exercises, and more at plainenglish.com slash 737.

00:01:53 Speaker_00
Before we start today's story, I'd just like to remind you that the podcast is just one part of how we can help you upgrade your English skills. At plainenglish.com, you can make faster progress with active learning strategies.

00:02:10 Speaker_00
You can take quizzes, do activities, listen to the fast version of the audio, Watch video workshops, practice what you learn, and even join a live call with JR and me.

00:02:24 Speaker_00
It's all about helping you build your skills to become a better, more confident English speaker. Sound good? Go to plainenglish.com to start your free 14-day trial today. Now, let's jump into today's story. gift-giving. It can be fun.

00:02:53 Speaker_00
It can be exhilarating. It can be exciting. It can be stressful. It can be magical. It can be disappointing. It can also be, according to economists, a huge waste.

00:03:12 Speaker_00
In 1993, the economist Joel Waldfogel published a paper in the American Economic Review called The Deadweight Loss of Gift-Giving. To economists, deadweight loss is a tragedy.

00:03:32 Speaker_00
It represents missed opportunities, ways we could have been happier or wealthier if not for some external factor. Here's what deadweight loss means in the example of gift-giving.

00:03:52 Speaker_00
The giver spends money on a product for someone else, but the person receiving the gift may think it's worth less than what the giver paid for it. The giver might spend $100 on a gift, but the recipient might only get $75 worth of pleasure from it.

00:04:23 Speaker_00
The difference, $25 in this case, is the deadweight loss. It's the value that is never coming back. One person spent $100 to give another person just $75 in value. That's like setting $25 on fire.

00:04:40 Speaker_00
The buyer should have just given the recipient $75 and kept the other $25 The recipient would have gotten the same value, and the buyer would, economically speaking, have been better off.

00:05:08 Speaker_00
To make a maximally efficient gift, then, you should just give cash or gift cards to stores you know your recipient likes. Um, I don't know about you, but that sounds boring to me.

00:05:25 Speaker_00
I don't want to live in a world in which everyone just gives everyone else gift cards.

00:05:33 Speaker_00
This economic paper has proven to be a great conversation starter, not because the findings are controversial, but because it makes you think about the purpose of gift-giving. Why do people give gifts?

00:05:52 Speaker_00
One purpose of giving gifts is to transfer wealth. In a wealth transfer gift, the giver wants to make the receiver richer in some material way. This is the perfect time to look to that economic paper.

00:06:14 Speaker_00
If what you really want is to make the recipient richer, then the best and most efficient way to do that is simply to give money. But if that makes you feel uncomfortable, then do the next best thing to giving money.

00:06:36 Speaker_00
You can see this with wedding registries. In many Western cultures, the purpose of buying a wedding gift is to help the new couple with the expense of setting up a new, better life together.

00:06:54 Speaker_00
The purpose of this gift is to transfer wealth from the giver to the happy couple. And it's common to give money at weddings.

00:07:06 Speaker_00
But the next best thing to money is to buy from a registry of gifts, a list of things that the couple has said that they want. This minimizes the deadweight loss. There's very little chance that they'll get something they don't want.

00:07:30 Speaker_00
The same goes for new graduates. You might give a high school graduate a new computer to take to college, but let her choose the model. You might give a college graduate some money to buy furniture or pay a security deposit.

00:07:52 Speaker_00
These are wealth transfer gifts. But not all gift-giving is like that. In fact, most gift-giving is different. Giving a gift within a family is not about transferring wealth, but about something else.

00:08:15 Speaker_00
Most gift-giving is about reinforcing social ties, about showing a person that he or she means something to you. And in these cases, Even if there is economic deadweight loss, there's still a social benefit that outweighs the loss.

00:08:42 Speaker_00
I don't like using cliche examples, but I'm going to in this case. Let's say a woman gives her husband a watch that costs $500. The man might only have paid $400 for that watch if he were shopping for himself.

00:09:07 Speaker_00
Now economically speaking, the couple is $100 worse off than if the man had just bought a watch for himself. but socially speaking, they are probably better off.

00:09:24 Speaker_00
That's because now, for as long as he owns the watch, the man might think of his birthday or the occasion of the gift whenever he checks the time. If he travels for work, it might be a reminder of the bond he shares with his wife, and so on.

00:09:47 Speaker_00
That's social connection, and it's worth more than $100, so both sides probably are better off. You get the idea. If you're going to give a gift, keep in mind that there's always the possibility of an economic loss.

00:10:09 Speaker_00
So as a gift giver, you should try to do things that make the gift about more than just money. Here are some ways you can do that.

00:10:22 Speaker_00
One, you can buy something that the other person would like and would value, but that the other person would never buy for him or herself. A great example here is a professional massage. Many people consider it a luxury to go to a spa for a massage,

00:10:47 Speaker_00
almost too much to spend on themselves, but they would really like it. So giving a gift certificate for a massage is great because it alleviates the guilt a person might feel when paying for a massage.

00:11:08 Speaker_00
I might feel guilty, I might feel bad about spending $200 on a massage so I don't do it. But if someone gives me a coupon for a massage, I don't have to feel guilty about getting it.

00:11:27 Speaker_00
The gift is the massage, yes, but the gift is also taking away the guilt, and you can't put a price on that. Number two, you can give a gift that introduces a person to a new thing or a new experience.

00:11:48 Speaker_00
Imagine you have someone on your wish list that loves musicals but has never been to an opera. you could buy tickets to the opera. Maybe he'll like the opera, maybe he won't, but either way, he will have had that new experience.

00:12:08 Speaker_00
Even if he doesn't like the show, well, at least he has a good story and now he's had that experience. A third thing you can do is add meaning to something with a modest monetary value. This is very, very common. How much does a hardcover book cost?

00:12:33 Speaker_00
$20 maybe? You might be able to spend a little more and get a signed version of the book. That makes it more meaningful. or you can write your own inscription inside the cover or pick out a colorful bookmark to place inside.

00:12:56 Speaker_00
Doing this adds a little personalization. It adds a little social value. This is a good time to mention handmade gifts. If you make something by hand, you put a little of yourself into the gift. That's something you can't buy in a store.

00:13:21 Speaker_00
That's a great way of adding social value to a gift. Now, the best gifts make a person feel seen and appreciated. And the best gift givers think about giving year round. They don't just Google best gifts 2024 a few days before Christmas.

00:13:46 Speaker_00
So if you missed this holiday season, don't worry. Start a list on your phone and start collecting ideas for the people you care about. Do that right away, and then you'll have gift ideas for when you need them.

00:14:11 Speaker_00
Joel Waldfogel, the author of that paper, wrote a whole book called Scroogenomics, Why You Shouldn't Buy Presents for the Holidays. But he did admit in an interview that he does buy gifts for some people, for people he knows well.

00:14:31 Speaker_00
And listen, I agree with that. If you don't know someone well, you can't add social meaning to a gift.

00:14:38 Speaker_00
So I say, think about the people you know well, give them a meaningful gift, and for everyone else, either don't buy them anything or give a Starbucks gift card or something like that. Today, you'll learn the English expression down the line.

00:15:05 Speaker_00
This first appeared in episode 445. That was about a movement called right to repair. And that means that for a lot of complex devices, everything from tractors to your iPhone,

00:15:22 Speaker_00
You're actually not allowed to make modifications to the device or the way it works. If you want to repair it or modify it, you have to use an official company repair shop. Now, a lot of people think this is unfair.

00:15:40 Speaker_00
They think they should have the right to repair their own devices. Now, you can do it now. You can open your iPhone and start messing around. You can try to repair your own John Deere tractor, but that can cause problems down the line.

00:16:03 Speaker_00
And now it's time for you to learn what that means, to cause problems down the line. Down the line means farther in the future or later in a process. When we use down the line, we are usually making preparations or being careful about the future.

00:16:38 Speaker_00
Earlier today, I said that it can be dangerous for a tractor owner or an inexperienced repair shop to make changes to the software on a complex, modern John Deere tractor. A person might be able to solve the immediate problem

00:17:04 Speaker_00
But if the solution isn't correct, it could cause problems down the line. That means it could cause problems in the future, problems that we can't foresee today.

00:17:23 Speaker_00
The makers of this equipment are worried that if they make their products easier to repair, it could hurt their profits down the line. That means it could hurt their profits in the future. Do you remember why?

00:17:45 Speaker_00
Well, for one thing, John Deere makes a lot of money on repairs and replacement parts. And Apple loves to sell you a new device rather than fix the one you have.

00:18:05 Speaker_00
If these companies make their products easier to fix, they might not lose much money the first day or even the first year, but they'll probably lose money down the line. They'll lose money in the future. This is going to cause problems down the line.

00:18:32 Speaker_00
That's something you can say if you're doing something today that will make things harder in the future. Now some of you, some of you have been with me here and with JR here at Plain English since the very beginning. Do you remember the first website

00:18:57 Speaker_00
Oh man, I don't even want to think about it. Going back three, four years, the way I originally put content on the website was unorganized. It caused lots of problems down the line when I wanted to change the look and feel of the site.

00:19:23 Speaker_00
You can sometimes use this if you want to say that something will happen at an unspecified time in the future. If you're young, you might like living in a big city, but do you want to live there forever? Mmm, maybe not.

00:19:46 Speaker_00
You might say, I'll want to leave the big city down the line, but for now, I'm happy here. That means maybe sometime in the future, you'll want to leave, but not now. And there you go. That was Plain English for the year 2024.

00:20:12 Speaker_00
We ended on episode number 737. Can you believe that? What a year it has been. We celebrated our 700th episode in style this year. We've had a lot of new plus members, some great new features in the membership, and I have a lot planned for next year.

00:20:36 Speaker_00
So thanks for sticking with us for all of 2024. JR and I will see you for some more Plain English in the new year.

00:20:45 Speaker_00
And don't forget, if you have some free time during the holiday period, check in for some classic episodes in your feed over the next two weeks. From all of us at Plain English, happy holidays, Merry Christmas, and Happy New Year!

00:21:04 Speaker_00
We will see you in 2025! Congratulations! You just learned a new English expression. But do you feel ready to use it in the real world? Just how confident are you? What if you could take a quiz to confirm your understanding?

00:21:27 Speaker_00
And what if you could write your own sentence using the expression you just learned and get human feedback from an expert English speaker? Believe it or not, we offer exactly that at plainenglish.com.

00:21:43 Speaker_00
Every time you learn an expression with plain English, you can write your own example using that expression.

00:21:51 Speaker_00
And then, an expert English speaker, that's me, an expert English speaker will read your example and give you personal feedback on how to improve. In other words, you can make all your mistakes with us in a friendly, supportive environment.

00:22:10 Speaker_00
and then you'll be an expert when you use the expression out in the real world. If that sounds good to you, then go to plainenglish.com and start your free 14-day trial.

00:22:24 Speaker_00
Practice as many English expressions as you like, and you'll get feedback on every sentence. Go to plainenglish.com to start your free 14-day trial today.