Sometime during my college days, I’d come across a definition that economics is the study of human behavior in conditions of unlimited wants and limited resources. The meaning would perhaps remain the same if I say that it is the study of human behavior in conditions where resources are lesser than required to satisfy wants. I think economics is also the study of human behavior in conditions where resources are morethan required to satisfy wants. We are living in times, where this condition is not utopian. There are umpteen examples of people, who have more resources than what they need to satisfy their wants.
I’m not getting into the distinction between need and want, but considering all that a person wants as his need. Also, ‘unlimited wants’ is a misleading notion because the capacity of a person to consume is finite. Therefore the term ‘want’ needs to be defined with more precision. But I’ll leave that for later.
In economics, a lot of emphasis is laid on the assumptions or emphasis is laid upon keeping exceptions out for the purpose of understanding the law. Here too, we begin with the study keeping exceptional possibilities out of the purview.
So, how do people behave when he has more than what he needs?
4. Spend on ‘unwanted’ stuff
5. Release / Let go
It need not be assumed that the above behavior is demonstrated only under conditions of excessive resources. They may be seen otherwise as well, but our study considers the conditions of excess resources.
Each behavior needs to be understood in detail. But that too I’d like to keep for later. I’ll briefly distinguish between charity & letting go and hoarding & investing. Charity is considered as directed giving i.e. giving for a specific purpose. Letting go is not even giving, it’s just letting go. Hoarding is considered owning without making an economic use and investing is putting the excess resources to economic use.
Determination of the characteristics of people who demonstrate each behavior and identification of causes, which make them do so are other areas of deeper study.
What is also interesting to me is to understand the impact of each behavior on the person and the society at large. If we widen the scope of resources to include non-financial resources like time, relationships, knowledge, natural resources, it opens up vast areas of further study.
I wonder if I’ve stumbled upon an idea for a doctoral thesis!