3 lessons for surviving the holidays

By Tyler Cowen, Money Magazine contributing writer


(Money Magazine) -- Whenever you mix extended family, financial outlays, forced jollity, and alcohol, you're risking trouble. Economics carries some lessons about how to prevent seasonal squabbles from reaching epic proportions.

Redefine how conflicts are perceived. Fights with family members get especially heated now because they're often part of a broader power struggle about who's boss. As economics Nobel laureate Thomas Schelling has shown in his work on collective bargaining, such conflicts can be defused by making it easier for everyone to give in this one time. Announce that the holidays are different: Compromising at this time of year will not set the precedent that someone will be expected to cave regularly in the future.

CDs & Money Market
MMA 0.39%
$10K MMA 0.35%
6 month CD 0.38%
1 yr CD 0.70%
5 yr CD 1.48%

Find personalized rates:
 

Rates provided by Bankrate.com.

Rely on trade and property rights -- two of the most central ideas in economics -- if people still aren't on the same page. Hold a family forum and swap for decision rights: You agree to control the tree decorations, for example, and your spouse gets to decide who is mailed a holiday card. Once control has been assigned to someone else, butt out.

Accept judiciously. During the holidays, you're bombarded with requests for favors ("Can you pick up the turkey for Aunt Jenny?") and invitations to events (your second cousin's Chrismukkah open house). Behavioral economists use the phrase "intransitivity of indifference" to describe what you're faced with. Accepting a few of the requests won't bother you, but if you accede to them all you'll be miserable. And a miserable person at Christmas dinner isn't exactly a recipe for family harmony. Say no -- and smile.

Are you stuck in a lousy 401(k) plan at work but want help maximizing your retirement savings? Send us an email at makeover@moneymail.com. For the CNNMoney.com Comment Policy, click here. To top of page

Frontline troops push for solar energy
The U.S. Marines are testing renewable energy technologies like solar to reduce costs and casualties associated with fossil fuels. Play
25 Best Places to find rich singles
Looking for Mr. or Ms. Moneybags? Hunt down the perfect mate in these wealthy cities, which are brimming with unattached professionals. More
Fun festivals: Twins to mustard to pirates!
You'll see double in Twinsburg, Ohio, and Ketchup lovers should beware in Middleton, WI. Here's some of the best and strangest town festivals. Play
Overnight Avg Rate Latest Change Last Week
30 yr fixed3.84%3.80%
15 yr fixed3.06%3.03%
5/1 ARM3.14%3.15%
30 yr refi3.91%3.86%
15 yr refi3.16%3.08%
Rate data provided
by Bankrate.com
View rates in your area
 
Find personalized rates:
Index Last Change % Change
Dow 17,712.66 34.43 0.19%
Nasdaq 4,891.22 27.86 0.57%
S&P 500 2,061.02 4.87 0.24%
Treasuries 1.95 -0.06 -2.94%
Data as of 2:10am ET
Company Price Change % Change
Intel Corp 32.00 1.92 6.38%
Bank of America Corp... 15.31 -0.11 -0.71%
Ford Motor Co 15.98 -0.03 -0.19%
Apple Inc 123.25 -0.99 -0.80%
Microsoft Corp 40.97 -0.24 -0.58%
Data as of Mar 27

Sections