The Benefits of Gift Giving

December 15, 2020
Written by: Sarah Reitz

With the holidays upon us, people all over the world will participate in a well-known tradition: giving and receiving gifts. This tradition has existed for centuries, even before the rise of corporate marketing in the United States1. But why has this tradition, which is costly and irrational from an economic perspective, stuck around for so long?

The psychology of gift giving

You probably don’t need a scientific study to tell you that giving and receiving gifts makes you feel happy, but the psychology of gift giving has nevertheless been the topic of much research, especially given how prevalent gift giving is across cultures. Specifically, a number of studies have examined the effect of gift giving, rather than receiving, on psychological well-being. This is because on the surface, giving gifts seems like a losing, costly scenario: you spend time and money on someone else, but get nothing in return. So why do humans all over the world do this?

Research has repeatedly shown that giving gifts increases happiness in the gift-givers. One study asked over 600 Americans to rate their general happiness and estimate how much money they spent each month on themselves or on others. They found that personal spending, or spending money on yourself, wasn’t related to self-reported happiness. However, increased prosocial spending, or spending on others, was correlated with significantly greater happiness2,3. To take this a step further, the researchers then gave a group of 46 participants an envelope containing $5 or $20 and instructed them to either spend the money on themselves or on someone else. By comparing participant’ self-reported happiness prior to spending the money with their happiness after spending the money, the researchers found that those who spent the money on others reported greater happiness than those who spent the money on themselves2. Interestingly, gift giving can even produce happiness long after the gift has been given, with participants reporting increased happiness after reflecting on a time they gave a gift to someone else3.

This same group of researchers also wondered whether this rewarding aspect of giving gifts to others only occurs in wealthier nations, or whether this is a more universal phenomenon. You might expect that spending money on others might not produce the same feelings of happiness if it comes at a greater personal cost. However, the researchers showed that the giving gifts and spending money on others is beneficial regardless of how much money you make. Students in Canada and Uganda both reported greater happiness when thinking about a time they spent their own money on others, compared to a time when they spent their own money on themselves. This was also true in participants from India. Additionally, students in both Canada and South Africa reported greater happiness after being assigned to spend money on treats for a sick child at a local hospital compared to students assigned to spend the money on themselves4.

It turns out that the relationship between the gift giver and receiver also has an effect on the happiness of the giver. People report greater happiness after thinking about a time when they gave a gift to a strong social tie, such as a close family member or friend compared to times when they gave a gift to a weak social tie, like a coworker or acquaintance5. Together, these psychological studies show that giving gifts actually does significantly increase our happiness, especially when given to people we have a close connection with. But what goes on in the brain when we give gifts?

The neuroscience of gift-giving

With advancements in brain imaging technologies, recent studies have begun to examine how the brain responds to giving and receiving gifts. Building on the psychology studies described above, one group of scientists measured changes in brain activity using fMRI imaging in participants who were given the choice to receive money (as much as $128), or donate that money to a number of charities, reducing the amount of money they would ultimately keep for themselves.  Unsurprisingly, receiving money activated the reward system in the brain of the participants, including the dorsal and ventral striatum and the ventral tegmental area, indicating that receiving money was rewarding to them. However, when the participants donated money to a charity, this reward network was activated even more strongly, suggesting that the brain perceives giving gifts as even more rewarding than receiving gifts. Additionally, the subgenual area of the brain became activated when participants donated to charity, but not when they kept the money for themselves6. This region is associated with social attachment and rewards derived from close social bonds, providing biological support for the psychological and economic hypothesis that gift giving serves to strengthen our social bonds.

A separate group of researchers took this a step further and recorded neural activity simultaneously in pairs of friends who engaged in a gift exchange to examine how giving or receiving gifts affects cognitive performance and brain activity7. They had each pair perform a task that required cooperation between them to examine whether the act of giving a gift could affect cognitive performance. Half of the groups exchanged gifts prior to the cooperation task, and the other half exchanged gifts halfway through the task. This study is unique because it used a brain imaging technology called functional near infrared spectroscopy (fNIRS), which measures changes in brain activity using infrared lights on a portable cap worn by participants. This allowed the researchers to examine brain activity during a more “normal” social situation rather than examining activity while the participants are lying in a noisy scanner, unable to interact. 

The researchers found that both speed and accuracy on the cognitive task improved significantly after exchanging gifts. They also found that activity in the dorsolateral prefrontal cortex (dlPFC), a region involved in social and cooperative interaction, increased in both participants following the gift exchange. By simultaneously recording brain activity from both friends, the researchers were also able to examine brain connectivity between the pair. Incredibly, the brain imaging revealed increased synchronization of dlPFC activity between the two members of the pair following the gift exchange. This may explain the enhanced performance on the cognitive task, as past work has shown that increased neural synchronization between members of a pair is associated with better performance on a cooperation task8. Together, this work shows that gift exchanges not only increase happiness, they also increase cooperation and can literally place you on the same “wavelength” as your gift recipient!

During this abnormal holiday season when many people are separated from their family and friends, these studies suggest that one way to spread happiness and strengthen our bonds is through the act of giving gifts. These gifts don’t have to be large or expensive; the benefits of gift giving occur no matter how much money is spent9. And if you want an extra hit of dopamine on top of your gifting-induced happiness, try finding a gift that’s on sale for a great deal!

Image References:

Cover image by Yvette Fang from Pixabay,


1. Ringel, P (2015). Why Do Children Get Presents on Christmas, Anyway?. The Atlantic. Available at:,a%20broader%20transformation%20of%20Christmas [Accessed December 8, 2020].

2. Dunn, E, Aknin, LB, Norton, MI (2008) Spending money on others promotes happiness. Science 319(5870)1687-1688. DOI: 10.1126/science.1150952

3. Aknin, LB, Dunn EW, Proulx, J, Lok, I, Norton, MI (2020) Does spending money on others promote happiness?: a registered replication report. J Pers Soc Psychol 119(2):e15-e26. DOI: 10.1037/pspa0000191

4. Aknin, LB et al. (2013) Prosocial spending and well-being: cross-cultural evidence for a psychological universal. J Pers Soc Psychol 104(4):635-652. DOI: 10.1037/a0031578

5. Aknin, LB, Sandstrom, GM, Dunn, EW, Norton, MI (2011) It’s the recipient that counts: spending money on strong social ties leads to greater happiness than spending on weak social ties. PLoS ONE 6(2):e17018. DOI: 10.1371/journal.pone.0017018

6. Moll, J, et al. (2006) Human fronto-mesolimbic networks guide decisions about charitable donation. PNAS 103(42)15623-15628. DOI: 10.1073/pnas.0604475103

7. Balconi, M & Fronda, G (2020) The “gift effect” on functional brain connectivity. Inter-brain synchronization when prosocial behavior is in action. Sci Rep 10, 5394. DOI: 10.1038/s41598-020-62421-0

8. Cui, X, Bryant, DM & Reiss, AL (2012) NIRS-based hyperscanning reveals increased interpersonal coherence in superior frontal cortex during cooperation. Neuroimage 59, 2430–2437. DOI: 10.1016/j.neuroimage.2011.09.003

9. Park, SQ, Kahnt, T, Dogan, A, Strang, S, Fehr, E, Tobler, PN (2017) A neural link between generosity and happiness. Nat Comm 8:15964. DOI: 10.1038/ncomms15964

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