Fun Is Better on Deadline

If you give your mother a gift card this Mother’s Day, make sure it expires soon; otherwise she might not enjoy it. That’s the suggestion of this Atlantic article (with a rather familiar headline), citing research by the economists Suzanne B. Shu and Ayelet Gneezy. They found that if you put a tight deadline on a fun activity, people are more likely to relax their self-control and enjoy it. Happy Hour just moved up a notch on the genius-idea scale. [%comments]


T-Bill

There should be a catchy name for this phenomena. Maybe there is. I suspect the same effect occurs in many contexts.

Sohaib

Sounds to me like added utility from knowing you juuuust made it. Reminds me of the way back in high school when +'s and -'s didn't affect one's gpa. Getting a B- was a heck of a lot more pleasing than a B+.

Science Minded

OK- let's say there is some truth to this. I told my students today- they have two weeks to prepare their group presentations-and all 5 group presentations will be done in a 3 hour time slot which means 32 minutes each group-- so they need to be organized. the initial reaction was-- doubt and uncertainty because it meant less time for each group and that they needed to get organized - what happened-- they did get organized when class ended. So I should follow my own advice. But I find that it is one thing when limits are set by others and they are external. It is another when one sets them for oneself. The latter is so much harder to adhere to.

Any thoughts?

Michael Cicconi

Not so easy here in Canada - gift cards cannot, by law, expire.

SHvnDave

Great Job! For years now, economists have been telling people to be careful when they buy cards because they may expire and this is bad because the money you spent at purchase becomes the property of the financial institution rather than the one you love. Now, we reverse the instructions and you want people to intentionally buy shore term cards - so more of our money can freely flow to the pockets of those that need it least.

Advice to be read and rejected if you ask me. By the way, who is paying the salary of these two econosocialogists?

Mike M

SHvnDave,

Your post assumes that cards are more likely to expire unused if they have a longer expiration date. It may be that a short limit actually decreases the percentage of unused cards because people feel a more pressing need to utilize the card and do not forget about or lose them.

I'm just speculating here, it would be interesting to see the data.

I do agree with you in principle though, I always give cash rather than a gift card.

Gabby

I think it has more to do with the splurge spending factor. if the gift card had no expiry date, the rational person would wait to use it to buy something they needed as the need arose. If they had to spend it in a short period of time, however, they would most likely buy something of a 'luxury', that they wouldn't consider buying without the gift voucher. The utility may be higher in the former case, but the fun factor is higher, i'd assume, in the latter,

Science Minded

What's the point here? You give the gift of a card to your mother with a limit on when it can be used-- it's used i.e., the receiver understands their time is limited for its enjoyment, so they take the time to enjoy the benefits- I see this application on many levels as previously pointed out. For instance, healthcare/insurance. You set a certain amount of money aside for it, and continue to add throughout your lifetime. The benefit--when you need it, you have it--no worry- and if you don't use it up in your lifetime, you can pass it on. the fun--- thinking positively about life. living, beating the odds.

Abhishek Sainani

This article and the reference links provided in this article has somehow convinced me that fun is better on deadline... it does seem obvious, however as everything else in this world, nothing can be generalized where humans are concerned... an exception always comes.
Guess I'll have to start keeping deadlines for myself now! :D

Eric M. Jones

When a guy asks a girl for her phone number, he'd better use it within 5 days. It has a definite but always unstated expiration date. Ask me how I know.

science minded

Dear Eric M. Jones;

Frankly, who's talking guys and girls in the usual sense. I am talking science. It's a matter of professional integrity- that is it. It is true that when it comes to science and science related matters, we may be made of a somewhat different cloth- so be it. But no matter-- I wish to keep my work strictly as my work-- I have observed male scientists becoming friends. When it comees to women, there seems to be a problem.... why should there be- unless of course- the men refuse to take the women seriously--- No wonder my mother gave me a boy's name- she, in a way, knew and hence predicted the problem that I would have being taken seriously. My way of dealing with such matters is to ignore it-- get right to the point-- Who are you i.e., as in what is your field of work?

Ian

This is a blog about economics!

Gift cards are a ripoff, plain and simple.

They are at best an interest free loan. At best!

Odds are good that they are a gift... to the store.

Here's a lousy gift. I bought you the gift of wasting your precious time buying something you don't want or need. How thoughtful.

Gift cards are almost as good a scam at the greeting card.

Here is a good idea. Donate money to a charity that you know will be meaningful to the person the gift card was for. Give them the tax receipt.

Rosinante

Ian, giving money to a charity is a worse waste than giving a gift company free interest -- the 'charity' is almost always simply a business that exists to keep it's staff in style on salaries that maketh the eyes water, whilst using the plight of some tragic people to advertise for suckers to finance their scam.

science minded

why do people give gift cards? Surely, it is in the interest of companies marketing these instruments of exchange to sell as many as possible. But let;'s look at it from the other side. Why would someone give such an impersonal gift? I can thinks of many reasons- in this day and age.

Laserlight

Contra Rosinante, there are charities which efficiently use their income for their announced purpose. However, I would not want someone to give to a charity on my behalf. For one thing, they probaby don't know me well enough to pick the right charity. For another, part of the benefit of giving is the emotional response I get from making a sacrifice to benefit something I care about--and if you're the one giving, I'm not making that sacrifice.

Even withgift cards, you're likely to pick the wrong thing for me. I've gotten cards for Starbucks; I never go there, so my only use for those is pass them on to the girl in our Accounting department who does go there. Give me a card for a book store, or give me cash :-)