Spookonomics: The economics of halloween

Halloween is a pointless celebration. The only benefits are the baking, the economic analysis and reminding people that door to door begging is illegal. So today, I would have done two of those three things just in this blog post.

Now the UK are pretty boring when it comes to celebrations, so today most of my stats will involve our neighbours across the pond where the real horror show is the election, but more on that next week.

 

Grave figures

So how much will the 171 million Americans who celebrate Halloween have spent this year? The answer to that is an extraordinary $8.4 billion. This will be the highest EVER level of spending on Halloween by our friends from over the pond. They will spend an average of $25 on sweets, $30 on Halloween decor and $32 on costumes. Halloween is the second biggest commercial holiday in the USA after Christmas.

A shinning light. (No, it’s the shinning. We don’t want to infringe copyright)

From this we can gain some useful economic analysis. Milton Friedman has a theory of which is called a permanent income hypothesis. He believes that we spend based on both our present income and our future predicted income. Therefore, as Americans are spending more, this shows that they have a lot of confidence in the US economy and their future economic prospects (A rather surprising notion on an election year). This also shows that they are likely to spend more at Christmas as well, so retailers will likely bring in extra stock and know that they can raise their prices. However, despite this idea, only 25% of people think their plans will be affected by the state of the economy.

Halloween4.png

Little treat of horrors

In economics, we have an idea called an externality. These are external things that happen outside of a transaction or consumption to other parties without affecting the price. For example, me buying fuel and driving a car, has negative externalities through pollution. A negative externality of Halloween is the dental costs incurred. Emergency dentist appointments increase by 80% thanks to Halloween. In the UK, dentistry for under 18’s is free. Therefore, as a tax payer, you have to pay the negative externality for those little idiot trick or treaters who spend their evening self inducing themselves with cavities. Therefore to demand a fee from the “trick or treaters” for the sweets as a form of taxation, which you will have to pay for their treatment, would be somewhat justified as we usually use taxation to make the negative externalities into internalities.

Halloween5.png
Say ahh

Here are a couple more spending facts:

  • Pumpkins are cheaper in October than December
  • 57% of people shop for decorations AFTER Halloween

Witch lessons are learnt?

Some economists have argued that Halloween, and trick or treating, teaches kids good economic lessons such as that people have to work for their rewards (Kids through trick or treating), bartering is an option to consider (although if anyone tried to barter with me, I would throw an apple at their head) and that in business appearance and being well dressed matters.

Halloween3.jpg

A couple of interesting pieces of history

In the olden days of hallows evening, the poor would be given pastries in exchange for them to pray for rich people’s dead relatives.

Before trick or treating, guising was done where kids would sing, perform poems or tell jokes in order

So, we have analysed a reasonable amount of ideas in Halloween. Just remember door to door begging is illegal in this country. Sadly, until the invention of Wonka-vision becomes real, I cant bake you anything. I would’ve gone trick or treating as the foreign secretary this year, but there has been a ban on clown masks.

-Swift economist

BORISCAKE

 

 

Source

Source

Advertisements

One thought on “Spookonomics: The economics of halloween

  1. In my opinion the spending on this tat doesn’t show confidence in the economy. It’s just a small spend per family to keep the kids happy. Since 99% of the tat is made in China it does more damage to the balance of payments i.e increasing imports. Most of it is throwaway so just adds to the mountains of litter polluting the neighbourhood while the toxic chemicals used in the garish paint and plastics will help poison the earth.
    Where the local economy does gain is the increased number of people going out to eat etc on the 31st to avoid the Trick or Treaters.

    Also, add to your dentistry costs the future type 2 diabetics impact on the NHS.

    This country needs to get a grip!

    Like

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s