What makes the world go round, pt2 necessity vs luxury
As I posted here the propensity of the economic dialogue generally consists of the poor becoming poorer, and the rich becoming richer. However as western societies have advanced at a tremendous pace many of the life essentials have slipped and many of the luxuries have climbed the charts to near necessity. I would attribute this to the need for individuals to establish a “status.” Many of the poorest people in the U.S. still have items which are considered quite luxurious in many countries; people give up paying for their health insurance, healthy food, etc…and trade it for cable access, large televisions, etc. This isn’t to say that many of the poor aren’t left behind, which results largely from sprawl and the lack of education….however the fact remains that while some people do remain poor, they still waste a lot of food, clothing, land, etc. As many have experienced, even in my own personal experience, children in schools would get discounts for being underprivileged, but at the same time would be driving a pretty nice car, have the latest phone, etc. This chart helps to illustrate what many people consider to be the necessities of life, some people have now even considered internet access a “human right.” I don’t know if this is a bigger sign of a social agenda or the strong upward progress of human living conditions over just the past two decades (most likely the latter). You can see the rest of the study which these charts were derived at Pew Research Center:
When it comes to income levels, the story is different. Here, the pattern tends to play out in one direction only: the more income a person has, the more likely he or she is to view goods and gadgets as necessities rather than luxuries.
However, the degree of variance varies. For some items, it is fairly significant and for others it is minor or non-existent.
Income makes a big difference when it comes to three information era items – home computers, high-speed internet access and cell phones. It also has an effect on attitudes toward one old warhorse of a home appliance – the dishwasher; and on one creature comfort – the car air conditioner.
It makes a smaller difference for cars and for clothes washers and dryers.
And it makes virtually no difference for a mixed bag of items, including home air conditioning, a microwave, and a battery of entertainment products, including a television, high definition television, satellite and cable TV services, and an iPod.
Overall, some 45% of adults with family incomes of $100,000 and above rate at least 10 of these 14 items as necessities, while just 15% of adults with incomes below $30,000 do the same. In short, the more money you have, the more things you need.
This quotes from Pew indicates that income has a heavy effect, however the percentage growth in the “needs” far exceeds the income growth between 1996 and 2006.