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Gift giving is a ubiquitous social phenomenon, and red packets have been usedas monetary gifts in Asian countries for thousands of years. In recent years,online red packets have become widespread in China through the WeChat platform.Exploiting a unique dataset consisting of 61 million group red packets andseven million users, we conduct a large-scale, data-driven study to understandthe spread of red packets and the effect of red packets on group activity. Wefind that the cash flows between provinces are largely consistent withprovincial GDP rankings, e.g., red packets are sent from users in the south tothose in the north. By distinguishing spontaneous from reciprocal red packets,we reveal the behavioral patterns in sending red packets: males, seniors, andpeople with more in-group friends are more inclined to spontaneously send redpackets, while red packets from females, youths, and people with less in-groupfriends are more reciprocal. Furthermore, we use propensity score matching tostudy the external effects of red packets on group dynamics. We show that redpackets increase group participation and strengthen in-group relationships,which partly explain the benefits and motivations for sending red packets.

Online Red Packets: A Large-scale Empirical Study of Gift Giving on WeChat