Maslow’s Hierarchy Of Needs

Hello. I want to make a post about Maslow’s Hierarchy of Needs. Before I got into mathematics and statistics, I was considering a career either in business and accounting or engineering. I learned about Maslow’s Hierarchy of Needs in a business course in high school. This topic is still in my mind from time to time as I think this model is a very good representation of human nature and human motivation.


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What is Maslow’s Hierarchy of Needs?

In 1943, Maslow stated that people are motivated to achieve certain needs and that some needs have higher priorities than others. There are five stages to Maslow’s Hierarchy of Needs and these five stages are displayed as a pyramid model.

Source: http://www.simplypsychology.org/maslow-pyramid.jpg

 

The pyramid starts from the bottom as the foundation for human motivation and human needs and goes to the top. In order to reach the next higher level, one must be satisfied with having their needs fulfilled at the previous level.

The Five Stages of Needs

  1. Physiological Needs: Survival items such as food, water, warmth, shelter and rest.
  2. Safety Needs: Security (locks), insurance, savings accounts, police, etc.
  3. Belongingness and Love Needs: Family, friends, companionship, intimacy.
  4. Esteem Needs: Items which gives feeling of accomplishment and/or prestige/status. Examples can include exercise, winning a competition or an award.
  5. Self Actualization Needs: One example would be seeking improvement in self.


Economic Considerations and Inflation

This hierarchical model is also used by businesses and marketing companies to target customers and influence them to purchase (their) products. For example, market researchers for a company may want to determine consumer spending habits. That information could be used to help develop a new product/service at strategically chosen price points/ranges in order to generate revenues.

Physiological Needs such as food, water, housing and electricity are always in demand as they are survival needs. Most of the household expenses goes towards these. For example, since food is always in demand, there are so many choices for food products and there are many restaurant choices.

Safety needs such as security needs are in demand in order to protect some of our (physiological) needs, lives and precious possessions. Many of us spend money on insurance and to banks for saving money for the future (or a “rainy” day).

As one goes higher up the pyramid, the demand may not be as high compared to the physiological and safety needs. In addition, prices may vary of these needs.

Some of the “needs” that are higher up in the pyramid are not really needs. They’re mostly wants. Such examples include a high-end luxury handbag at $2000, a new television model, and video games.

Also, some items at the bottom of the pyramid can be expensive and/or can be considered as items on near the top of the pyramid. For example, food is typically for survival but it can also be an esteem need. Expensive seafood can be an esteem need as one could take a picture of it, eat it, find out it tastes really, really good and share it online. Another example includes celebrities having homes worth at least one million dollars. The homes can be considered both a survival need and as an esteem need.

Note that Maslow’s hierarchy is not a one size fits all model since everyone has different motivations and needs.

The Inflation Problem

Many of us do not like higher prices of items and reduces the purchasing power of money (paying more to get less). If you really think about it, not all inflation is the same in terms of impact. Inflation on basic needs and in demand items such as food, electricity, water, transportation and shelter hurts more than inflation on items such as televisions and high end clothing.

Inflation hurts those on fixed and low incomes and may influence those to step down on the Maslow’s heirarchy of needs. Those who do not scale back by reducing (unnecessary) spending may face financial difficulties and debt.

In times of inflation, there are people who really choose to scale back, remove the excess, minimize spending as much as possible. The result is having “just enough” to meet basic needs, safety needs and other needs from Maslow’s hierarchy. One may refer to this group as minimalists.


References

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

http://www.businessballs.com/maslow.htm

https://figures.boundless-cdn.com/29841/large/Maslow’s_hierarchy_of_needs.png

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