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Inferior, Normal & Luxury Goods: A Consumer's State Of Finance?

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Mostly, the expenditures or the spending habit of people is mostly a direct reflection of their earning or income. In Nigeria for example you tend to know when someone's income increases; their need for a specific kind of good either increases or decreases. For example, garri (cassava flakes) is a type of food that's considered to be affordable by anyone in Nigeria.

However, when people buy it more often, it is like a direct Interpretation of their state of finance. This is what i'll exactly call inferior goods. These are types of commodities which the need for them actually decreases the moment people who buy them experience a positive change in income.

A positive change means having a higher pay at work while a negative change means losing one's job or being demoted, now a positive change means more "money" while a negative change means "less money". In Nigeria for example, people stop eating garri when their income increases, they rather choose a protein substitute like wheat meal.

The Main Reason For Inferior Goods

Now let's look at inferior goods as a concept. We must understand that the real reason for inferior good is because of low income, having money makes people pick normal goods. This is because normal goods are type of goods that people would originally go for if the conditions are quite right.

So inferior goods are the opposite of normal goods, however they're foods that are close substitutes despite the fact that the different between them is the spending power of a potential consumer.

When you look at some countries like Nigeria and Venezuela, the citizens of these countries are striving hard to live through the economic conditions of their countries, the adjustability to Inflation, fewer jobs on the market, bad leadership and all that eventually makes people go for inferior goods rather than normal goods, we have to understand that the meaning of "inferior" is "less"

Brand & Brand-less Substitute

This signifies that "less" means affordability. It's a state where people have to select a "less" attractive option because they cannot afford the regular options. Take a lot at the human society, we buy brand. The higher the brand choice, the more our financial capacity is Interpreted.

Apple for example is a brand that represents luxury and sophistication, the brand after Apple is Samsung. Inasmuch as there might be a bizarre representation of which brand holds higher quality. We have to understand that most people's preference for the two brand often Interprets their technical "know-how" and most importantly financial status.

There are other "brand-less" substitutes in the market which typically comes as a saving grace especially for people who cannot afford brands. This is to say that inferior goods are regularly not recognized or reckoned with especially because it holds no qualitative substance.

Normally people see the need for luxury when their Income increases, for example taking a cab for a distance which can be covered by trekking is an example. However let's look at a good can be an inferior good as well as normal goods.

Garri for example, is a Nigerian food which the rich and poor can actually afford and eat. This is because it is a good that one of a kind, However the dimension at which it is consumed is what gives it a different feel. The level of ingredients added differently when consuming it is what actually spells people's financial capabilities and not the good in itself.

This means that we have goods that can actually pass off as both inferior and normal. Sometimes, people's ability to switch up on different types of food and not actually sticking to one would somehow translate or explain their total understanding into the concept of inferior or normal goods.

Quality & Price

However, we mostly equate quality to price and this is because sometimes we feel what is pricey would actually translate to quality. But this isn't always true. An inferior good can actually do a very good job at satiating or taking care of a need, it's just that mostly we often go for more colorful variety when the means becomes available.

This is why the demand for inferior goods decreases overtime. People will frequently equate a negative meaning to a particular kind of goods and this is majorly because these goods should be inferior goods, and they're actually frowned upon especially when the standard of living of people increases, and they would need to up the quality of their lives as well as begin to live differently.

At almost every point in time everyone would have experienced this. In modern world, we are having better substitutes for inferior goods more than it used to be in the past and right now, brands, company are beginning to make goods in-between inferior and luxury.

Interested in some more of my works?

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The Nigerian/African Disposition On Marriage As An Endowment
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