Christmas Game Theory

The lovely wife says the jewelry I bought her for Christmas has to be returned because "it's just too expensive!"  Excellent.  I get the credit without the credit bill!

What I will never reveal is how far I looked down the game tree before purchase.

Addendum: Do not try this at home.  Without extensive knowledge of game theory and your spouse this strategy can be very dangerous to your finances, c.f. Thomas Schelling, brinksmanship.  


Reminds me of what they used to call him back in High School: Alex "Dirty Dog" Tabarrok.

What used to be viewed as virtues and vices are now called game theory. And they charge tuition for it.

First, since money is fungible, she should have said she would return it and keep the money for herself. Either she would spend it or she would keep it away from you; both of which are maximizing alternatives.

Second, next year when you play this game you should not assume her information set is empty. She might have read this blog. Beware.

Haha, Scott - well said.

do the people who dug these jewels out of the ground for a pitance or the children who cut them (they have great eyes for cutting stones you know) figure into this game theory calculation at all?

Scott's likely right. She didn't like it and is making points for both of you by claiming it's too expensive. A smart and kind woman (married to one of those myself for 34 years today).

Or Alex was well aware that she wouldn't like it, couldn't find anything better and suspected she would have him send it back. So he dodged finding a good gift while shifting the responsibility for the failed gift.

I would have taken the gift and if i did like it - say that i would take it back but keep it, and if i didn't like it, i would have either traded it in for something i did like, or sold it on ebay and spent the money on a trip to a beach somewhere! Are you kidding?

Alex, this story is incomplete. She says, "It has to be returned, its just too expensive!"

And then you said.... what? "OK!"?

Do not try this at home

A stingier student of Nash
Thought, while tying a ribbon and sash,
"If I spend to excess,
For return she will press
And I'll keep all the kudos and cash."

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