Gifts, cash, and stigma

Each year individuals in the United States transfer between $50 and $72 billion in resources in the form of noncash holiday gifts, despite the fact that holiday gift recipients apparently value their noncash gifts at about 10% less than the prices paid by the givers. We document that cash giving is more likely from givers who tend to give unwanted gifts, indicating that givers are concerned with the utility of their recipients. The rarity of cash gifts can be rationalized by a stigma of cash giving that we are able to parameterize and estimate using a simple structural model.