Difference Between Needs and Wants

We all know that economics is a social science, which deals with production, distribution and consumption functions. It is all about making choices regarding the allocation of scarce resources, so as to make their best possible use and satisfy human wants and needs. In economics, we often go through the terms needs and wants, but have you wondered about their differences. Needs point out the something you must have for survival.

On the other hand, wants refers to something which is good to have, but not essential for survival. For the purpose of spending and saving money wisely, every person must know the difference between needs and wants.

Content: Needs Vs Wants

1. Comparison Chart
2. Definition
3. Key Differences
4. Conclusion

Comparison Chart

Basis for Comparison	Needs	Wants
Meaning	Needs refers to an individual's basic requirement that must be fulfilled, in order to survive.	Wants are described as the goods and services, which an individual like to have, as a part of his caprices.
Nature	Limited	Unlimited
What is it?	Something you must have.	Something you wish to have.
Represents	Necessity	Desire
Survival	Essential	Inessential
Change	May remain constant over time.	May change over time.
Non-fulfillment	May result in onset of disease or even death.	May result in disappointment.

Definition of Needs

By the term needs, we mean those requirements which are extremely necessary for a human being to live a healthy life. They are personal, psychological, cultural, social, etc that are important for an organism to survive.

In ancient times the three basic needs of the man are food, clothing and shelter but with the passage of time, education and healthcare also became integral, as they improve the quality of life. They are a person’s first priority as they are the things, that they keep us healthy and safe. Therefore, if needs are not satisfied in time, it may result in illness, inability in functioning properly or even death.

Definition of Wants

In economics, wants are defined as something that a person would like to possess, either immediately or at a later time. Simply put, wants are the desires that cause business activities to produce such products and services that are demanded by the economy. They are optional, i.e. an individual is going to survive, even if not satisfied. Further, wants may vary from person to person and time to time.

We all know that human wants are unlimited while the means to satisfy those wants are limited. Hence, all the wants of an individual cannot be met and they must seek for alternatives.

Conclusion

With the above discussion, on these two concepts of economics, it concluded that needs and wants are separate forces, that compels actions for satisfaction. If needs are not met on time, the survival of a person is at stake whereas wants are something which a person is craving for, that does not challenge a person’s survival if not satisfied.

So, needs can be distinguished from wants on the basis of their level of importance. Hence, the distinction is between what is required and what is desired.