ISTS owmight opposing schools of economic thought – from neoclassical and Keynesian to Libertarian and Marxist – view Christmas presents? Levity aside, the answer reveals the pompousness and vacuity of each and every economic theory. NEOCLASSICISTS: Given their view of individuals as utility-maximizing algorithms and their obsession with a paradigm of purely utility-driven transactions, neoclassical economists can see no point in such a fundamentally inefficient form of exchange as Christmas gift-giving. H
By Yanis Varoufakis
When Jill receives a present from Jack that cost him $X, but which gives her less utility than she would gain from
commodity Y, which retails for $Y (which is less than or equal to $X), Jill is forced either to accept this utility loss or to undertake the costly and usually imperfect business of exchanging Jack’s gift for
Y. Either way, there is a deadweight loss involved. The neoclassicist thus endorses
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the Scrooge hypothesis: The best gift is no gift.
American Consequences 69
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