publication . Article . 2007

Markets: Gift Cards

Jennifer Pate Offenberg;
Open Access
  • Published: 01 Apr 2007 Journal: Journal of Economic Perspectives, volume 21, issue 2 Spring, pages 227-238
Abstract
<jats:p> The Mobil Oil Company introduced the first retail gift card that recorded value on a magnetic strip in 1995. In under a decade, such gift cards replaced apparel as the number one item sold during the Christmas season. This study will discuss the reasons for the strong surge in the gift card market. It will then consider the value of gift cards as an intermediate option between two alternatives: purchasing a physical gift, which could possibly be returned or exchanged, versus giving cash. Empirical data on the resale price of gift cards from an Internet auction website provide information on the value that recipients place on gift cards suggesting that t...
Subjects
free text keywords: Economics and Econometrics
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