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having gotten the okay from federal authorities that “Halloweening” can resume this
year, various fearsome characters may soon be chanting “trick or treat” again at
doors all over America. As a consequence, we will be restarting some excellent
illustrations of basic economics
Such an apparent extortion threat seems far from the allegedly dismal science, but in
fact, Halloween reflects economics’ central precept that people choose by comparing
the benefits and costs they expect to bear as a result of their choices.
For example, modern jack-o-lanterns are carved out of pumpkins for economic
reasons. They originated in Ireland as hollowed-out turnips used as lanterns, but
pumpkins were more plentiful in America and made better lanterns, so the tradition
migrated to pumpkins.
Dark houses and scary costumes originate from benefit-cost comparisons. In the fifth
century B.C., Celts celebrated their New Year–Samhain–on October 31. According to
legend, on that day the spirits of those who had died during the year searched for
living bodies to possess as their only hope of an afterlife. Therefore, people made
themselves unattractive “candidates,” to avoid such a fate. Houses were left dark,
cold and undesirable, and people dressed ghoulishly to scare away the “shopping”
spirits.
It originated with “souling” in ninth century Europe. On All Souls Day, poor
Christians would go door-to-door asking for “soul cakes”–bread studded with
currants. The more cakes they received, the more prayers they would say for the
donor’s dead relatives. This theological exchange of bread for prayers was viable due
to the belief that prayers by the faithful could hasten the passage of the departed into
heaven.
Halloween also turned when daylight savings time “falls back” into a major issue, in
search of added sales from an extra hour of trick-or-treating. Lobbying led George W.
Bush to sign the Energy Policy Act, which took effect in 2007, extending daylight
savings time by a week to enable it (Now it ends the first Sunday in November).
Because Halloween is also the biggest night for costume rentals and purchases and
behind only New Year’s and the Super Bowl for alcohol sales, sellers in these
industries pray for a weekend Halloween so more adult parties will take place. The
Halloween Association trade group has even proposed permanently making
Halloween the last Saturday in October, to get more economic bang out of the
holiday.
Halloween is also one of many children’s first experiences with economic decision-
making.
How long should you continue to trick or treat? You stop when the costs in terms of
tiredness and sore feet outweigh the benefits of the additional candy. Is it really
worth walking to the dentist’s house to get a toothbrush? Which streets should you
hit? Such decisions reflect costs (how far do I have to walk?) versus the value of
likely treat benefits to them. The number of lights on, the income level and number of
kids in the neighborhood all enter this calculation. Children also learn to ask others
about the likely loot payoff before choosing their path. Some parents even drive their
children to other neighborhoods to increase their trick-or-treat haul.
When are you too old to trick or treat? When the cost of the hassles you get about it
outweigh the benefits of the candy and fun you expect.
Children staying with friends Halloween night also learn how markets work, via
candy exchange negotiations. I can still remember my amazement at the large
number of hard candies one could get in exchange for, say, a Snickers or Reese’s, in
trade, at one post-rampage party when I was young.
The economics of Halloween affects others as well. Homeowners learn why the trick-
or-treater’s dream–a bowl of candy with a sign saying “take all you want”—doesn’t
work very well, except at running you out of candy quickly. Primary school teachers
are much more likely to call in sick after Halloween because the children are either
still going to be on their sugar high or suffering from the low that follows, and what
meager learning will take place doesn’t justify the cost of containing the
pandemonium.
In other words, economics is far from dismal; it can shed real insight on every
activity in a world of scarcity, including Halloween. In fact, when we extort treats
with threats the same month that the federal fiscal year begins, and just before major
elections in every even-numbered year, it reminds us of how commonly trick-or-
treating describes politics as we are forced to bear it.
Summary