Ooo! Lovely! Honest...

A FORMER editor of this newspaper once said that “a gift is a sale at a price of zero”. In strict monetary terms this is true. But most people do expect to be paid for gifts, albeit in the non-monetary currency known as “gratitude”. This has many denominations: words of appreciation, hugs and kisses and, particularly, smiles. The wider point our ex-editor was making, though, is pertinent. A gift will cause a misallocation of resources if the recipient would have preferred something else that would have been no more expensive for the donor to acquire.

In this context, a study just published in Psychological Science, by Adelle Yang at the National University of Singapore and Oleg Urminsky at the University of Chicago, looks illuminating. Dr Yang and Dr Urminsky have studied the currency of gratitude and think it may be creating poor incentives. Their hypothesis is that the reason gift-givers sometimes appear to make bad decisions (that is, choose gifts the receiver would not have chosen him or herself) is not always that they do not know what the recipient wants. Sometimes it is that the receiver rewards the giver with signals of gratitude that do not seem to correspond with a gift’s long-term utility.

To test this idea, Dr Yang and Dr Urminsky framed an experiment around St Valentine’s day. They picked three pairs of appropriate gifts: a dozen roses in full bloom versus two dozen rose buds that were about to blossom; a bouquet of freshly cut flowers versus a bonsai; and a heart-shaped basket of biscuits versus a similar basket of fruit. In each pair they hypothesised that the first, with its immediate visual appeal, strong scent or flavour, was more likely to induce a powerful appreciative response in the recipient but that the second, because of its greater quantity, durability or wholesomeness, was likely to be more satisfying in the long term. They also checked that these beliefs were not mere personal prejudice by confirming them with 104 volunteers recruited online.

They then recruited a further 295 online volunteers on February 13th, the day before St Valentine’s, in order to catch people in an appropriate mood for the experiment. Volunteers were required to be in a romantic heterosexual relationship and were paid $2 each to evaluate the pairs of gifts. Men were asked which of each pair they would prefer to give to their inamorata. Women were asked which they would prefer to receive. Both sexes were also asked to predict how much of an “affective reaction”, as psychologists label such things as smiles and hugs, the receiver would show in response to a particular gift and which would create the greater long-term satisfaction.

As far as affective reaction and satisfaction were concerned, this second group of volunteers agreed with the first group about which gifts would elicit what response. Even so, men went for the smiles and hugs more often than it would seem that women would have wished. Specifically, 44% of them said that they would prefer to give roses in full bloom while only 32% of the women said they preferred that gift to the two dozen buds. Similarly, with the bouquet and the bonsai, 40% of the men preferred to give the bouquet but only 28% of the women preferred to receive it. Both of these results are in line with Dr Yang’s and Dr Urminsky’s hypothesis. The case of the biscuits or the fruit, though, is more complicated. As predicted, men preferred to give the biscuits more often than women preferred to receive them. But the relevant numbers were 73% and 61%. In other words, unlike the other two cases, a majority of women did also prefer the gift with immediate, sugary appeal rather than long-term wholesomeness, despite what they had said about the long-term value of fruit.

None of this, however, explains why recipients should be willing to pay more enthusiastically in the currency of gratitude-displays for short-term pleasure rather than long-term satisfaction. If the gratitude market were working correctly, buds would trump flowers, bonsais bouquets and fruit cookies. Yet they don’t.