1. ECONOMICS
MODULE - 1 HumanWants
Understanding Economics
Notes
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2
HUMAN WANTS
Inourdailylifeweseethatdifferentpeopleareengagedindifferenttypesofactivities.
Forexample,somepeopleareengagedinfarming,someworkinoffices,someare
sellingvegetables,somearehavingdifferenttypesofshops,somearerunningfactories
etc.Thesepeopleareengagedindifferenttypesofactivitiestoearnincome.Theyhave
toearnincomebecausetheyhavetosatisfysomanywants.
Toearnincomepeopleuseresourcesmanmadeornatural.Wantsareunlimitedbutthe
resourcesarelimited/Scarce.
OBJECTIVES
Aftercompletingthislesson,youwillbeableto:
explain the meaning of wants;
explain how wants arise and grow;
understand that all wants can not be satisfied;
state the characteristics of wants;
know how resources satisfy wants;
differentiate between economic and non economic wants;
explain that with development wants expand and change;
understand the Indian philosophy of limiting wants.
2.1 MEANING OF WANTS
Itishumannaturetohavemanygoodsinlife.Therewouldbeanendlesslistofsuch
wishes. Let us call these wishes as ‘desires’. One may desire a good house, a car, a
computer,goodfood,decentclothesandsoon.Howcanonegetallofthese?Onemay
2. MODULE - 1
Understanding Economics
HumanWants
ECONOMICS
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havethesethingsifhe/shehasmoney.Ifonedoesnothaveenoughmoney,thenonlyone
or two of these or none of these could be purchased. Which of our desires are to be
fulfilleddependsuponourcapacitytopayorpurchasingpower.Thatiswhynotall
desirescanbemetasweneedmoneytosatisfythem.Thedesireswhicharebacked
bymoneyandwillingnesstopurchasemaybecalledwants.Abeggarmaydesiretohave
acarbutthisdesirecannotbecalledawantasitisnotbackedbyadequatemoney.
However,ifarichmandesirestohaveacarandiswillingtopurchaseit,thedesirecan
beturnedintoawant.
DesireforagoodorService + Moneytopurchaseand
willingnesstopurchase
Want for a good or a service
2.2 HOW DO WANTS ARISE AND GROW
Wantsareapartofourliving.Theyarisewiththebirthofman.Maninancienttimeswas
satisfiedwhilelivinginforests,drinkingwaterfromthestreams,pluckingfruitsfromtrees
oreatinganimalflesttosatisfyhunger.Hehadlimitedwantswhichwererelatedtofood,
Shellerandclothing.Overaperiodoftime,thesewantshavegrown.Howdidithappen?
Withthediscoveryoffiremanstartedcookingfood.Thisledtothediscoveryofnew
fooditems.Man’stastegrewandexpanded.Alargevarietyoffoodstuffscameinto
existence.Todayyoucanfinddifferentvarietiesoftastes,coloursandshapesinfood
items.
Asregardsclothing,manhasmovedfromunstichedanimalskinsandtreeleavestoa
varietyofclothes.Inordertolivebetter,mandiscoveredandinventednewitemsof
clothing.Asknowledge,tasteandfashionareincreasing,newandbetterproductsin
clothingareemerging.
Inasimilarfashion,needforhousinghasalsoundergoneatremendouschange.Manhas
movedfromcavestohutsmadeofstrawandpuccahousesmadeofbricks.Nowadays,
houses made of wood, pucca houses, bungalows and palaces with fancy doors,
windowsandallsortsofdecorativepaintsandfixturesareinuse.
However,somewantsmaybenecessaryfortheexistenceoflife.Forexample,food,
clothingandshelter.Thesearecalledbasicwantsornecessities.Therearesomeother
wantswhichmakeourlifeeasyandcomfortable.Thesearecalledcomforts.Examples
ofcomfortsmaybecoolers,scooteretc.Somegoodsgiveuspleasurebuttheyarevery
costly. For example, luxurious cars, diamond jewellery etc. such good are called
luxuries.
3. ECONOMICS
MODULE - 1 HumanWants
Understanding Economics
Notes
10
2.3 SATISFACTION OF WANTS
Doallourwantsgetsatisfied?No,Assoonasonewantissatisfiedanothertakesits
place;ourwantsincreasebecausewedesiretoliveabetterandcomfortablelife.Asnew
goodsandservicearedeveloped,wewantthem.Wantscanbesatisfiedbygoodsand
services.Goodsandservicescanbeproducedwiththehelpofresources.Land,labour,
capitalandentrepreneurshiparecalledresourceswhichhelpintheproductionofgoods
andservices.Wantsareunlimitedbuttheresourcestosatisfythemarescarce.Assoon
asonewantissatisfied,anothertakesitsplace.Someofthesewantscanbesatisfied
by man with his limited income while for others he may not be able to do so. It is,
therefore, not possible to fulfill all our wants though a single want is satiable.
2.4 CHARACTERISTICS OF WANTS
Thefollowingarethemostimportantcharacteristicsofwants.
(i) Wantsareunlimited:
Famous economistMarshallhasrightlysaidthathumanwantsarecountlessinnumber
andarevariedinkindAssoonasonewantissatisfiedanotherwanttakesitsplace.This
endlesscircleofwantscontinuesthroughoutlife.Forexample,apersonwhohasnever
usedafanwouldwishtohaveafan.Whenthiswantissatisfied,hewouldwishtoget
anaircoolerandascooter.Oncethesewantsaresatisfied,thenhewouldwishtohave
an air conditioner, a car and so on.Thus, we see wants never come to an end.
(ii) A single want is satiable
Eachwanttakenseparatelycanbesatisfied.Ithasrightlybeensaidthatthereisalimit
toeachparticularwant.Forexample,ifamanisthirstyhecansatisfyhisthirstbytaking
one,twoorthreeglassesofwaterandafterthathedoesnotwantwateratthatpoint
oftime.
(iii) Somewantsariseagainandagain
Mostwantsrecur.Iftheyaresatisfiedonce,theyariseagainafteracertainperiod.We
eatfoodandhungerissatisfiedbutafterafewhours,weagainfeelhungryandwehave
tosatisfyourhungeragainwithfood.Therefore,hunger,thirstetc.aresuchwantswhich
occuragainandagain.
(iv) Varyingnatureofwants
Wantsvarywithtime,placeandperson.Theyarealsoinfluencedbymanyfactorslike
income,customs,fashion,advertisementetc.Forexample,wewantmedicinesonly
when we are sick. Ice is needed in summer season only.We need woollens even in
summerataplacelikeSrinagar.Similarly,peoplehavestartedusingthingslikeT.V.
4. MODULE - 1
Understanding Economics
HumanWants
ECONOMICS
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Sets,mobilephones,carandmanyotherluxurygoodsduetoincreaseintheirincome
andchangeinfashion.Thus,wantshavebeenfoundtovaryandtomultiplywiththe
economicdevelopmentofacountry.
(v) Presentwantsaremoreimportantthanfuturewants:
Presentwantsaremoreimportant.Apersonusesmostofhislimitedresourcesforthe
satisfactionofpresentwants.Hedoesnotworrymuchabouthisfuturewantsbecause
futureisuncertainandlessurgent.Forexample,providingfortheeducationofchildren
inthepresentismoreimportantthanprovidingforoldagesecurityinfuture.
(vi) Wantschangeandexpandwithdevelopment
Asimpleexampletoshowhowwantsarechangingisthetelephone.Earlier,intherural
areastherewerenotmanytelephones,buttodaytelephonehasbecomeanecessityfor
everybodyforkeepingintouchwiththeirnearanddearones.Peopleusingtelephone
earlier,arenowusingmobilephones.Theywantmoreandmorefacilitiesintheirmobile
phonessuchas,Camera,Internetandsoon.
INTEXT QUESTIONS 2.1
1. Howdoesadesiredifferfromawant?
2. Giveoneexampletoshowthatwantsariseandgrow.
3. Whyareallwantsnotsatiable?
4. Stateanytwocharacteristicsofwants.
5. When does a desire become a want?
2.5 HOW RESOURCES SATISFY WANTS
Asstatedearlierwantsaresatisfiedwiththeuseofgoodsandservices.Toproduce
thesegoodsandservices,resourcesareused.Withevergrowingwants,wehavebeen
makinggreateruseofresources.Resourcemaybenaturalorman-made.Allresources
canbeclassifiedintoland,labour,capitalandentrepreneurship.Forexample,forthe
production of wheat, we use land, labour, tractor pump set etc. (capital). Farmer
(entrepreneur)organizesallthesefactorstoproducewheat.Healsousesseeds,manure
andfertitilizersinthisprocess.Thus,productionofwheatinvolvestheuseofresources.
Similarly,productionofallothergoods&servicesalsoinvolvestheuseofresources.
Aretheresourcesunlimitedlikeourwants?Theansweris‘no’.Theresourcesthatwe
usetosatisfyourendlesswantsarelimited/scarce.Withthedevelopment,newgoods
5. ECONOMICS
MODULE - 1 HumanWants
Understanding Economics
Notes
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areinventedwhichleadtoincreaseinourwants.Buttheresourcesdonotincrease
accordingly.Thismayleadtoexhaustourresources.
2.6 ECONOMIC AND NON-ECONOMIC WANTS
Wehavesofarlearntthatwantsareunlimited.Theydifferfrompersontoperson.As
youknowmanyofourwantsaresatisfiedbyusingcertainsgoods,andservices.These
goodsandservicesarepurchasedfromthemarketbypayingaprice.Thewantsthat
can be satisfied by such goods and services are called economic wants.
Afewthingsthatwewant,arenotpurchasedfromthemarketbypayingaprice.
Suchwantsarecallednon-economicwants.Forexample,wewantairtobreathe,
rainwaterforagricultureetc.Whenwewantamaidtocook,itisoureconomicwant.
Butifthefoodiscookedbymother,itbecomesnon-economicwant.
INTEXT QUESTIONS 2.2
1. Nametheresourcesusedintheproductionofwheat.
2. Whichoneofthefollowingisscarceinsupply?
(a) Resources (b) Wants
3. Giveanytwoexamplesofeconomicwants.
4. Giveanytwoexamplesofnon-economicwants.
2.7 WANTS EXPAND AND CHANGE WITH
DEVELOPMENT
Inancienttimes,manwassatisfiedwithsimpleitemsoffood,clothingandshelteretc.
Butwiththedevelopmentthesewantsgrewinnatureandnumber.Ourwantforfood
weeathaschanged.Wewanttoeatnotonlybetterandnutritiousfoodbutdifferent
varietiesoffood.Similarlywewanttowearnotonlyapairofclothesbutwewantvariety
aswellaslatestdesignsaccordingtothefashion.Wewanttohaveabetterhousewith
modernfacilitieslike,airconditioners,geysers etc.youallknowthatforcommunication
wenotonlywantasimpletelephonebutalsoamobilephoneshavingmanyfacilitieslike
camera,internet,videorecordingetc.Thus,man’severgrowingandchangingwants
leadtomanyinventionsanddiscoverieswhichresultinnewandbetterqualityofgoods
andservices.
2.8 INDIAN PHILOSOPHY OF LIMITING WANTS
Asweallknowourwantsareunlimitedbutourresourcestosatisfythesewantsare
limited.Henceifwekeepourwantsasunlimitedandgrowing,wewillnotbeableto
6. MODULE - 1
Understanding Economics
HumanWants
ECONOMICS
Notes
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satisfyallofthemwithourlimitedresources.Thiswillgiverisetoalotofdissatisfaction.
Butontheotherhand,ifwelimitourwantswewillbeabletosatisfymostofthemwith
our limited resources and this will give us more and more satisfaction. The Indian
philosophyhasalwaysbeentolimitourwantssothatwefeelsatisfiedinlife.Thishelps
ustoleadahappylifeaswedonothavetosufferanyunhappinessduetounfulfiled
wants.
Eventhefatherofournation,Gandhijialwaysadvocatedcontrollingofone’swantsso
that we can have a satisfied life and we do not have to indulge into wrong deeds or
practicestosatisfyunlimitedwantsoutofourlimitedresources.Therehavebeenmany
greatthinkerswhohaveadvocatedthesame.
INTEXT QUESTIONS 2.3
1. What is the Indian philosophy related to the satisfaction of wants with limited
resources?
2. Giveoneexampleofcommunicationsystemtoprovethatwantschangeandexpand
withdevelopment.
WHAT YOU HAVE LEARNT
Thedesireswhicharebackedbymoneyandwillingnesstopurchase,maybecalled
wants.
Wantsaresatisfiedwiththeuseofgoodsandservices
Economicwantsaresatisfiedbyusinggoodsandservicespurchasedfromthe
marketbypayingaprice.
Non-economic wants are satisfied by using goods and services which are not
purchasedfromthemarketbypayingaprice.
Withthediscoveryandnewinventions,newwantsariseandgrow.
Somewantsmaybenecessaryfortheexistenceoflife.Thesearenecessities.
Wants,whichmakeourlifeeasyandcomfortable,arecalledcomforts.
Some wants give us pleasure but they are satisfied by costly goods are called
luxuries.
Althoughasinglewantissatiable,allwantscannotbesatisfiedduetothescarcity
ofresources.
