Valentine's Day: Planning Perfect Date

Valentine's Day: Planning Perfect Date

by Amna, Kate, Selena and Akhanda

Valentine’s Day (AKA Single Awareness Day) is this upcoming Friday, and couples will be exchanging gifts, going out to dinner, and spending time with each other. This pseudo holiday has seen increasing consumerism in recent history; stores start putting up Valentine’s Day decorations days after New Years, and people start to feel the pressure to buy chocolate, flowers, cards, and even rings for their significant others. Valentine’s Day “craze” affects college students about as much as everybody else, including those of us in the Five College area. According to the National Retail Federation, consumers are keeping a tighter leash on their spending for Valentine’s Day. Students are bound to an even tighter budget within which the cost of the stereotypical dinner and entertainment (or gift) has to fall. A common question that people come up against is "how much should be spent on the entertainment and how much on dinner?”

Take Mary's significant other, Alex. Alex knows that Mary loves getting taken out to dinner and going to music events, and (s)he wants to make the 2014 Valentine's Day very special for her. Unfortunately, Alex is but a poor college student, and has a budget of $100. So, (s)he sets out to plan out the evening. Mary loves all musical concerts, ranging from local recitals to small concerts to big productions. In particular, Mary loves Adele. She also loves fancy restaurants and fancy champagne, but she is a foodie, and loves to try different types of food, regardless of price level. So, after some research on local restaurants and concerts, Alex decides that they will go to Thai Garden in Northampton and see a local band's concert. But after some calculation, (s)he realizes that there is still money left over, so Alex decides that instead of seeing the local recital, they could afford to see a Mumford and Sons concert* instead.

The above hypothetical scenario is descriptive of how many couples would make decisions on how to spend on Valentine's Day. Underlying Alex's decisions is the economic concept of utility maximization.

We can see that for Alex and Mary, going to Thai Garden and seeing Mumford and Sons is strictly preferred to going to Thai Garden and seeing a local band's concert. Therefore, Alex and Mary will be maximizing their utility on Valentine's evening. While most people don't think in strict economic terms when planning out a date for their significant others, but the thought process is similar, and the concept of utility maximization is quite illustrative.

* Assuming that Mumford and Sons concert is more expensive and preferable to Mary.