This topic explores the difference between essential needs and non-essential wants, the personal resources used to achieve them, and the wider consequences of consumer choices. Final examination questions test your ability to categorise needs and wants, review personal resources, and evaluate the economic, social, and environmental benefits and costs of spending decisions.
Needs and Wants
A need is something essential for survival and basic health, such as nutritious food, clean water, warm clothing, and safe shelter. A want is something a person desires to improve comfort or lifestyle but can live without, such as games consoles, designer fashion, takeaways, and holidays abroad.
Whether an item is a need or a want often depends on the context:
- A warm winter coat is a basic need to protect your health during cold weather.
- A €300 designer coat is a want because a much cheaper alternative serves the same physical purpose.
Resources are limited, so choices have to be made: needs are paid for first, and wants come out of what is left.
Personal Resources
To satisfy our needs and achieve our wants, we draw on different personal resources. Money is only one resource, and achieving personal goals usually means combining financial and non-financial assets.
| Resource Type | Description | Everyday Example |
|---|---|---|
| Material resources | Money and physical possessions you already own | Birthday money or a bicycle you can use or sell |
| Personal qualities | Skills, talents, and positive character traits | Baking ability, repair skills, or determination |
| Time | Hours available to study, work, or practise | Setting aside two hours after school to learn a skill |
| Family and community | Support, transport, and advice from people around you | A lift to sports training or guidance from a teacher |
Reviewing personal resources means checking what assets you currently hold and deciding how best to combine them to achieve a target.
Impact of Consumer Choices
Every consumer decision creates wider consequences for the individual, society, and the environment. These impacts include both costs and benefits.
Negative impacts (costs):
- Economic cost: the money paid out for a good or service, leaving less money for other things.
- Social cost: harm caused to people or communities, such as buying goods from sweatshops that exploit workers with low pay and unsafe conditions.
- Environmental cost: damage inflicted on the natural world, such as dumping electronics into landfills or creating plastic pollution.
Positive impacts (benefits):
- Economic benefit: money spent in local shops keeps businesses trading and supports local jobs.
- Social benefit: buying from a charity shop or social enterprise raises funds that help people in the community.
- Environmental benefit: repairing an item or buying a reusable bottle reduces waste and saves scarce raw materials.
Key terms
- Need
- An item or service essential for human survival and basic health, such as food, water, and shelter.
- Want
- A non-essential good or service that a person desires to improve comfort or lifestyle, but can live without.
- Personal resources
- The total assets available to an individual to achieve goals, including money, possessions, skills, time, and community support.
- Economic cost (financial cost)
- The money cost of a choice — what is paid out, and the money then not available for something else.
- Social cost
- The negative impact that a production or consumption decision has on people, workers, and wider society.
- Environmental cost
- The damage inflicted on nature and ecosystems through economic activity, such as pollution or resource depletion.
Check yourself
What is the key difference between a need and a want?
A need is essential for survival and basic health, whereas a want is an optional luxury you can live without.
Name three types of personal resources other than money.
Personal qualities (skills), available time, and support from family, friends, or community.
Give one economic benefit of spending money in your local shops.
It supports local businesses and helps keep local people in jobs.
Give one social cost of buying cheap clothing from fast-fashion retailers.
It can support low wages and unsafe working conditions for garment workers abroad.