Money is the basic need of every person, which is required to satisfy basic needs such as food, clothing and shelter. Lets take an example, when a person is earning 50,000 and his basic needs are satisfied with 40,000, he is happy that he is able to meet his basic needs, and is a happy person.
When the same person starts earning 100,000 then his consumption also proportionately increases. Economist call this “marginal propensity to consume“.
This gets the person into a vicious cycle where his needs starts getting into greed. His needs keeps increasing and then it become a greed.
This is the reason why you would find that people are never satisfied with money and as economist says “human wants are unlimited“.
To be satisfied with the money you have, you need to keep your needs limited or have unlimited money. But even if you have unlimited money, you would never be able to satisfy the unlimited wants.
Richard Stallman – Founder of Free Software Foundation, says I don’t like expensive luxuries. he often prefers to travel by the cheapest means of travel. He also calls kids as expensive luxuries 🙂
Once you get out of the vicious cycle you start enjoying life more. Rather than focusing on satisfying your basic needs you can now focus on bigger things that you always wanted to do. You are also able to dream and work towards achieving your dreams.
We often find Indians living in India are struggling with their basic needs but when the same person goes to the West, he/she is able to go beyond the basic needs. You find people writing books, becoming management gurus and achieving their goals. This doesn’t mean that the person can’t do the same in India but when you have millions of people around you which are competing to satisfy their basic needs, you get pushed into the rat race to earn more. Once you realise this, you are able to focus more on your goals rather than your basic needs.
The solution around this to keep your basic needs limited even when your income increases. This way you are not spending more, have more money than you need and money doesn’t become a concern anymore.
“Money is the basic need of every person …” correct at one level of analysis. On another deeper level, money is pretty worthless when it comes to meeting basic needs. You can have all the money in the world (gold if you prefer, or paper money if that is what you have) and unless you exchange it for stuff, you have pretty much nothing that can sustain you. It is a fundamental mistake to confuse money with things that money can buy. Money is a medium of exchange and have no value in use, only value in exchange.
Income is most frequently denominated in money terms but basically your income is a share of what is produced. Money merely allows you to produce one thing but consume another. That is, money gives you the freedom to consume stuff other than the stuff that you yourself produce.
The rest of the analysis — about keeping your needs within the bounds of your income — is of course valid.
hi prakash,
This is a fantastic thought. Will remember & definately practise & preach this.
rgds
chetan shah.
Well written!!!!
The line between wants & needs is very fine. It should be a Laxman Rekha. Once you know the difference and don’t allow it to blur you have won.
In real life needs never grow. In job situations when the requirements grow one has to make a balanced decision & get “most bang for the buck”. You will never regret your decision.
Well written.
Even though this may be a valid analysis of behaviour, i would argue that anyones basic needs would require a $40K salary, as you could SURVIVE with probably $5K /year. Just eat noodles every day, drink water, wear the absolute minimum amount of clothes you can find and live in the cheapest/smallest place you can find. Id say, that in Finland in the town i live, i can get if i wanted to live that way a 12m^2 apartment for $150/month, and eat and drink for $30/month. Maybe also buy clothes to survive the winter for $50/year. That makes the total cost of fulfilling your basic needs around $2000/year. Everything a person wants in addition to this is something he wants and not something he needs to survive. So every person, no matter does he want a tv, a dishwasher, a kitchen table or two mansions, a ferrari and a private jet is acting out on his wants, not needs. How can we make a value judgement on whether wanting a kitchen table or wanting a mansion and a ferrari is a good/bad thing, when neither of them are basic needs. Everyone has needs that has to be fulfilled to allow the person to survive. After that its just a matter of preferences and ability to attain the things you want. Whether it is a yacht in Monaco or peace and quite in rural India, both of them are personal preferences, and i for one dont feel like im entitled to make any value judgements on either of them.
http://questionersden.blogspot.com/2008/01/greed-and-need.html
well written,
good point janne, but i think that ‘basic needs’ should just mean things you need to survive comfortably. i mean, if you want a fine line between needs and greed, just take a look at how the less fourtunate are doing. if you could just see how well off we are compared to the homeless down the street, you would be disgusted for saying things like “i need a new phone!” or ” i need those new shoes.”
i know im a little off here, but if we all just tried to be less greedy, we would have time to see all the amazing privaleges we have, like just having access to a computer to write this comment..
some ppl havent even SEEN a computer and their thankful for the food and homes they have.
but i guess like prakash said: human wants are unlimited.
.. srry i kinda ranted but its the truth
Man becomes greedy because of his need