inferiorvaror

Inferiorvaror, or inferior goods, are goods for which the quantity demanded tends to fall as household income rises, all else equal. They are characterized by a negative income elasticity of demand (Ed < 0). The basic intuition is that when people become wealthier, they substitute away from cheaper, lower‑quality options toward higher‑quality or more desirable alternatives.

Common examples often cited in economic discussions include inexpensive staple items, discount or generic brands, and second‑hand goods. In practice, whether a good is considered inferior depends on consumer preferences and available substitutes within a specific income range and market. A product may be inferior for some consumers or in some regions while being normal or even superior for others.

It is important to note that the classification is relative to income and context. A good can be inferior at lower income levels but become normal as income grows, and vice versa. Inferior goods are not necessarily of low quality; their demand pattern reflects consumer substitution choices driven by income changes. During economic downturns, demand for inferior goods may rise as households reallocate spending, whereas expanding economies often see a shift toward normal or luxury goods. A related concept is the rare Giffen good, a subset of inferior goods where the price increase leads to higher quantity demanded due to strong income effects.