I love this paper. In fact, this paper confirmed that I made the right choice to major economics.

The paper’s summary is that gift giving creates dead weight loss because it takes time to think about the gift, purchase the gift, and no matter how good you are you will not get the gift that the person wants.

Grandpa and grandma will give sweaters or clothing that is not your style or will not fit. Dad may want fishing gear but you may not be able to afford that so you end up giving something way less of value.

So giving unwanted gifts leads to a cost of returning the good, which involves going back to the store and for the firm, it costs money to get the return and do something with the returned good.

So in the end, there is a huge dead weight loss.

Now the argument goes that sentimental value and feelings can compensate for that dead weight loss somewhat but it is costly.

How do we handle this deadweight loss?

Give cash instead!

Cash is awesome because it can be used anywhere, no deadweight loss.

Ah, such economic epiphany!

The funny thing is that Koreans and Chinese give cash as gifts so looks they figured out about dead weight loss-

These days because giving cash directly seems too aloof, we have gift cards-

And few days ago, I was shopping at Marshall’s and heard this-

When I heard the gift card ad, I remembered the paper about deadweight loss, wow…how memory works. And now I know why I am a researcher.

My wife finds it cool and amusing the fact that researchers can connect anything to research.

Anyway, I was just curious how fungible Marshalls gift card was. So what is the utility, if it is almost like cash then it should not have a much discount on a used gift card website. For instance, you don’t see Amazon gift cards at a discount because you can pretty much buy everything on Amazon so it is like 100% cash.

I looked up Marshalls gift card value through CardPool.

Actually the discount is about 4-5%, wow- that is quite low. I thought it would be higher because the Marshall inventory changes a lot with whatever they can get. So that was interesting. I guess Marshalls gift cards are like cash not much dead weight loss.

One caveat, of course, there is only 9 results so small sample… still an insightful exercise-

Finally, if you are not sure, just give an Amazon gift card. It works

Thank You Jesus for all Your love and wisdom.

I am thankful for being able to conduct research.

Let us share Your love and wisdom with others.

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I remember writing somewhere to look for deals on Prime Day-

But I just realized that it was today after checking my email before winding down…

Be nice to your professors and also those who have young babies- Life is quite busy for them-

Always blessed and thankful! Thank You Jesus!

So what should we buy on Prime Day?

Well, you should buy things that increase your utility for some time at a discount.

Given that our bank accounts pay us almost nothing, steep discounts is a good way to save money and increase utility for some time-

So here are my picks-

Instant Pot

Instapot is a revolution. I bought mine almost two years ago on a deal and it has been amazing. This pot will make good rice, broil meet, and you can even bake with it! It is super sturdy and your wife will love it. My wife fell in love with it and uses it to nourish the family and guests. Google/ YouTube instapot and you will find tons of recipes! Getting chubbier every day-

WD External Hard Drive

Yes, we have cloud storage. BUT! Never hurts to backup your data on a external hard drive as well- Remember redundancy creates less trouble and headaches. I had numerous PhD friends and professors lose data-

And in CA, internet outage is real. So is electronic outage. What do you do when you can’t access your data on the cloud? And you have a deadline for your journal submission?

That’s right- Always, have some external hard drive backup. I load up almost everything on Dropbox but I still have some bulky external hard drives just in case. Reduce risk and sleep better

MicroSD

Not a real streamer or photographer but I love these microSDs- They last for a long time unless you lose them…I have a gopro and a camera and look forward to purchasing more recording/photography gear (if my wife allows). These microSDs are very good. I still my use my cards that I bought many years ago

Life Straw

Never hurts to be cautious. Have one or two just in case. Hope no bad disaster hits but when things go down, you need air and water first (food comes later). So just buy them when they are cheap and you know you will be safer. Also, take it when you go to places for safety measures. Minimize downside risk

Thank You Jesus for all Your abundance. Let us share Your love and blessings with others! Amen!

If you enjoy the content, you can support the blog through clicking the referral links that I use in my life: Acorns, Dropbox, Robinhood, American Express, evernote, and Scribd.

When we pray God will forgive and heal the land and bless us–

Deuteronomy 11:14

that He will give the rain for your land in its season, the early and late rain, that you may gather in your grain and your new wine and your oil.

I just read that Napa Valley’s wildfires have damaged the wineries.

This is a huge blow to the wineries and the region as COVID19 decimated the tourism and service industries (about 70% down)

Just when we thought more people drinking wine at home would have helped the wineries , wildfires struck-

So what are the economic implications-

First, the wineries are crushed. Lot of businesses probably have some insurance but that won’t be enough. I expect some wineries shutting down, and it may provide some opportunities for bold investors to buy distressed wineries/vineyards.

So if you have money and want a winery/vineyard, this may not be a bad time to consider buying up one now and have it for generations. The graph below shows that winegrapes values have done well the past 25 years.

Second, California wine prices will go up due to constrained supply. But many customers will substitute for cheaper wine or just beer. So that won’t help much. In fact, other wineries outside of California may gain market share after the wildfires.

Third, Napa County and its cities will be in more fiscal stress. COVID19 already dried up the tourism revenue and the wildfires destroyed whatever taxes that governments could have collected.

Napa County’s unrestricted net position is a deficit already and will probably become more negative.

Without city/state bailout, Napa will have to cut down more. They may ask help from Pelosi but Trump says no deal…at least for now. Let’s see how everything plays out.

So in sum, Napa wineries and Napa County are in dire situations but those who want to own a fine Napa winery may have a great opportunity now.

Thank You Jesus for all Your blessings. Please bring us rain and heal our lands. We pray for Your love and mercy. Amen!

If you enjoy the content, you can support the blog through clicking the referral links that I use in my life: Acorns, Robinhood, American Express, dropbox, evernote, and Scribd.