MMario seems to be closest to what I remember from elementary school explanations. (I actually remember what grade school teachers told me in the 50's? Scary stuff.)

I was told that it was native custom that when one was given a gift, the proper thing to do was to give a gift in return as a way of honouring the original donor and his gift.

It was the white man's perception of this custom that gave rise to the phrase as an epithet.

"white man's perception" = truth. Pfahh! Phooey!