Do we exchange gifts because we desire, as Adam Smith said, not only to be loved, but to be lovely?

See Adam Smith and Loveliness from Liberty Fund, Inc. Here is the full quote from The Theory of Moral Sentiments and on the Origins of Languages (Stewart ed.): 

"Man naturally desires, not only to be loved, but to be lovely; or to be that thing which is the natural and proper object of love. He naturally dreads, not only to be hated, but to be hateful; or to be that thing which is the natural and proper object of hatred. He desires, not only praise, but praiseworthiness; or to be that thing which, though it should be praised by nobody, is, however, the natural and proper object of praise. He dreads, not only blame, but blame-worthiness; or to be that thing which, though it should be blamed by nobody, is, however, the natural and proper object of blame." 

I thought of Adam Smith's theory on this while reading A Perfect Christmas Is Suboptimal: Gift giving is inefficient from an economic point of view. It’s an example of ‘expensive signaling’ by Harvard economics professor Roland Fryer. It seems that the aim of this "expensive signaling" might be not only to be loved, but to be lovely. Excerpts:

"In buying gifts, Americans also spend time—hours browsing, guessing, wrapping and returning. Valued at something like the average hourly wage and added to typical holiday spending, the implied resource cost of Christmas gift-giving, by my estimate, is roughly $1,500 to $2,300 per shopper."

"Gifts aren’t primarily about consumption. They are about relationships. A gift is a signal: evidence that someone noticed you, thought of you, took time and tried."

"Economists call this “costly signaling.” When signals are cheap, they are easy to fake and quickly lose informational content. “I care about you” is cheap talk. Cash can be cheap talk too: It requires little information and little effort. It is efficient, yes—but efficiency isn’t always what the recipient wants to maximize. Often the real question is simpler and more human: Do you know me? Did you try?"

"A slightly “wasteful” gift can be a more credible signal than cash precisely because it reveals effort."

"The worst gifts aren’t the ones that miss; they are the ones that reveal no attempt at all—generic, last-minute, indistinguishable from what you would give a coworker in an office Secret Santa."

"We are purchasing something other than objects: reassurance, attention, belonging—a ritualized way of saying you matter to me and I am willing to incur a cost to prove it."

Incurring a cost might be a clear and believable signal that you love someone. And you might be able to tell yourself that you are lovely because you did so.

Related post:

Adam Smith said that people want not only to be loved, but to be lovely (but how much does it cost to achieve that?) (2025)