How to Maximize Your Halloween Candy Haul (Ep. 99)

(Photo: Jeff Turner)

A few weeks ago, we got an e-mail from a reader Vishal Dosanjh, who lives in St. Louis:

My daughter asked me this morning why the fancy neighborhoods are the best places to go trick-or-treating. It puzzled me for a moment and then realized it was an economic question. I gave her an answer about disposable income and societal expectations. Anyway I thought it might be up your alley, and I wonder if it’s even true. Do wealthy neighborhoods/people actually give out better candy? She’s 8 by the way.

We set out to answer Vishal’s question in our latest Freakonomics Radio on Marketplace podcast. It’s called “How to Maximize Your Halloween Candy Haul.” (You can download/subscribe at iTunes, get the RSS feed, listen via the media player above, or read the transcript here.)

After speaking to Vishal and his daughter, Sophia, we learned that their neighborhood isn’t very good for trick-or-treating: too many houses don’t participate and Vishal is worried about safety. So they wanted to find another St. Louis neighborhood that would be better.

Enter the economists.

In this episode, you’ll hear from John List, the University of Chicago economist who has been featured here many times (and in SuperFreakonomics), often for his excellent research into charitable giving.

You’ll also hear from Stan Humphries, chief economist at Zillow, the real-estate data empire. Zillow has built a trick-or-treating index that incorporates home value, housing density, walkability, and safety.

Unfortunately, that index did not include St. Louis — but Zillow was kind enough to run the numbers there for Vishal and Sophia, and came up with just the right neighborhood for their candy-hunting.

Hopefully we will let you know sometime soon how Sophia fared.

Alexis Buono

A major part that goes into the idea of giving away candy on Halloween is incentives. If one is thinking like an economist, the incentives of giving away candy versus not giving away candy play a huge rule depending on what neighborhood a family is from. For instance, Rick Bonish who is from St. Louis, mentions how he spends around $300.00 on Halloween candy every year. His neighborhood has 20 houses on each side of the block, and if one person doesn't have on their lights on the night of Halloween, everyone will notice. Considering mostly everyone in Rick's neighborhood passes out candy, the benefit of passing it out versus not passing candy out is larger. Another ideal from an economist is value is subjective. Since the beauty is in the eye of the beholder, a little kid might see huge houses and think a lot of candy. Vishal’s daughter, who also lives in St. Louis, was only 8 years old and she understood the idea that maybe the nicer houses have more money to spend on candy. This also explains how Halloween candy could be considered a normal good because families with a higher income might spend more money on it. In an economist's mind, in addition to house value, the walkability, neighborhood density, and crime information are all factored into who gives out the best candy. One last idea is there are always tradeoffs. A family who doesn't want to give away candy could easily turn off their lights and not answer the door. The tradeoff to not giving away candy is having the neighbors around that house have a different view of those people. An economic gain is the money that they saved from not buying candy.