285 - How Economics Helps in Our Daily Life

In this episode, I talk about the role the economy plays in our day-to-day behavior. 

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Episode Notes:

The economy, our income, and our spending power

"Your income determines how much you can afford to allocate to different needs and wants. Most of us need a place to live, transportation and a certain amount of food. Economists refer to these as basic needs, which tend to get first priority. Your income is limited, whether it comes from traditional employment, self-employment or a combination of these -- even if you're a billionaire. Of course, someone who has a lower income will tend to spend a higher percentage on basic needs because they have to. Households with higher incomes can afford to allocate more of their incomes, as a percentage and in absolute dollar terms, to discretionary purchases."

https://budgeting.thenest.com/5-economic-factors-influence-peoples-behavior-25099.html

Economic development and individual and social behavior

"Several studies previously pointed out that for many people unemployment leads to deterioration of mental state, increased anxiety, depression, decreased life satisfaction and overall indifference."

https://www.sciencedirect.com/science/article/pii/S1877042813052361

Maslow's Hierarchy of Needs

"This five-stage model can be divided into deficiency needs and growth needs. The first four levels are often referred to as deficiency needs (D-needs), and the top level is known as growth or being needs (B-needs).

Deficiency needs arise due to deprivation and are said to motivate people when they are unmet. Also, the motivation to fulfill such needs will become stronger the longer the duration they are denied. For example, the longer a person goes without food, the more hungry they will become."

https://www.simplypsychology.org/maslow.html