The National Retail Federation predicts that each of us will spend an extra $935.58 during this holiday season.
However Quartz took us beyond the U.S. and called Canadians “aggressive” holiday spenders. Compared to the previous 11 months, their spending on electronics almost doubles during the holidays:
Similarly, for clothing, Canadian spending pops a whopping 77%:
The Gifts We Want
According to a recent paper from researchers at Indiana University and Carnegie Mellon, our intuition is pretty inaccurate when it comes to gift giving. We shouldn’t care about someone’s apparent delight when opening a gift.
The key is how the person feels the next day. Preferring what they noted on a registry or list, people like to get what they request. They also usually are not really pleased with that $250 water buffalo you gave in their name to a family in Cambodia. In fact, an expensive gift will not necessarily be more welcome than something cheaper. Instead, we like practical gifts like warm socks and experiential presents like a massage.
Our Bottom Line: Consumer Spending
Although consumption expenditures account for close to 70 percent of the GDP, deciding how much holiday spending adds is tricky. Composed of Consumption Expenditures, Gross Investment (primarily business spending but also residential housing), Government Spending and Exports minus Imports, the GDP is adjusted for seasonal variation. Also, we could have the increase from holiday shopping offset by a decrease elsewhere. And beyond that, retail sales are tough to track for the holidays. Since statisticians look at monthly and quarterly data, how to include those gift cards?
All of this returns us to where we began. In the U.S. and beyond, consumers spend more during the holidays. But the impact of their spending on the GDP is tough to calculate.
My sources and more: Always interesting, Quartz has more on what different countries spend. Then, Ana Swanson had the perfect complement in her Washington Post shopping article and its link to the Carnegie Mellon/Indiana research. Finally, WSJ and the National Retail Federation provided the last pieces of the puzzle through their discussion of the holidays and retail sales.
