Playground economics

I am formulating a theory that the economy works a bit like kids in the schoolyard.

In the weeks leading up to Christmas, the kids compare notes on what presents they're expecting, and to start off these predictions are pretty reasonable. A remote control K9, maybe. A book of short trips. The obligatory satsuma.

The predictions are based on tangible evidence - what they got last year, how much their parents are likely to spend, what they've actually asked for.

Slowly, though, the competition grows. A new Playstation wossname, or a bike, or something else a bit more costly. The kid who starts it merely wants to claim, "My parents really love me" - it's less about greed as about confidence.

But that makes everyone else feel a bit rubbish, so they're saying that they'll be getting something similar. An X-box or a go-kart... It's important at school that you don't lose face.

No one wants to go too far too quickly for fear of being caught bullshitting. But the bluff continues with its own inertia; real, achievable gains slowly warping into dreams. Anyone a bit flash, a bit bolshy, is likely to increase everyone's stakes.

But it can't go on forever. If no one says "Balls!" at any point, if they don't escape the cycle, then it's all brought crashing down anyway by the reality of Christmas Day. Targets are only partially met. They might not even have got all of their original, paltry wants.

And who is to blame for this calamitous shortfall? The kids comparing notes that first day back at school know exactly where the error lies.

Their parents simply failed to deliver. If only they could sack them.