Normal goods are those whose demand increases as consumer income grows. Although there are several classes of consumer goodsand services within a economía, most of these are classified as normal goods. These types of goods are usually governed by the Normal Law of Demand in which income and demand are proportional, but in addition to that, normal goods have a series of peculiarities that differentiate them from the rest.
How are the normal goods?
It can be classified as a normal good that which meets a series of characteristics that are specific to this type of goods, among which the following stand out:
- Consumption of normal goods increases as the per capita income of natural persons. This means that the greater the availability of income by the population, the greater the demand for normal goods. Not only does this usually lead to an increase in their consumption, but as the demand for these goods increases, it is more than likely that the prices of these goods will also rise. This type of relationship between ingresos and the demand is known as elasticity of positive income.
- In the event that the increase in demand leads to an increase in the price of normal goods, the demand will be reduced since consumers will stop consuming it if it costs them more.
What types of normal goods are there?
Within normal goods there are 2 groups: essential goods and luxury goods. Depending on the growth rate of consumption based on the increase in consumer income, normal goods will be classified into one group or another:
- Normal basic necessities: these are those goods whose rate of growth in demand is less than the rate of growth of consumer income. They are usually basic food products such as eggs or milk.
- Normal luxury goods or superiors: in this case the increase in demand for these goods is faster than the growth in people's income. It usually includes foods such as meat and fish, textile products and leisure services.