9560 Chapter 4 Perspective 4 Maslow Hie
Applications of the economic way of thinking: domestic government and management policies
CHAPTER
4
Perspective 4: Maslow’s Hierarchy of Needs and Economists’ Supply and Demand Curves
MBA students will rarely make it through their programs without encountering “Maslow’s Hierarchy of Needs” in several of their courses, most notably their marketing courses. A. H. Maslow, a psychologist, argued that basic human needs can be specified with reasonable clarity and can be ranked according to their importance in providing motivation and influencing behavior (Maslow 1954, primarily chapter 5). Embedded in Maslow’s hierarchy is a theory of human behavior that is to a notable degree foreign to the economist’s way of thinking. Often, Maslow’s hierarchy is treated in business courses with some reverence, as though it were a form of revealed truth about human behavior. We will see in this Perspective how we can apply supply-and-demand-curve analysis to development of any “hierarchy of needs.” This analysis will help us understand the differences between the economic and the psychologcial approaches to welfare enhancement.
The hierarchy of needs
Maslow’s hierarchy is shown in figure P4.1.1. The importance of needs – in terms of how powerful or demanding they are in affecting human behavior – ascends as one moves downward through the pyramid. That is, the most fundamental or prepotent needs, which are physiological in nature, are at the bottom. This category of needs includes on one level all attempts of the body to maintain certain chemical balances (such as water, oxygen, and hydrogen ion levels). On a higher level, the physiological needs include the individual’s desires for food, sex, sleep, sensory pleasures, and sheer activity (meaning the need to be busy).
The need for safety, which is next in prepotence, may include the desires of the individual for security, order, protection, and family stability. The next category, belongingness and love, may include, among
CHAPTER
4
Perspective 4: Maslow’s Hierarchy of Needs and Economists’ Supply and Demand Curves
MBA students will rarely make it through their programs without encountering “Maslow’s Hierarchy of Needs” in several of their courses, most notably their marketing courses. A. H. Maslow, a psychologist, argued that basic human needs can be specified with reasonable clarity and can be ranked according to their importance in providing motivation and influencing behavior (Maslow 1954, primarily chapter 5). Embedded in Maslow’s hierarchy is a theory of human behavior that is to a notable degree foreign to the economist’s way of thinking. Often, Maslow’s hierarchy is treated in business courses with some reverence, as though it were a form of revealed truth about human behavior. We will see in this Perspective how we can apply supply-and-demand-curve analysis to development of any “hierarchy of needs.” This analysis will help us understand the differences between the economic and the psychologcial approaches to welfare enhancement.
The hierarchy of needs
Maslow’s hierarchy is shown in figure P4.1.1. The importance of needs – in terms of how powerful or demanding they are in affecting human behavior – ascends as one moves downward through the pyramid. That is, the most fundamental or prepotent needs, which are physiological in nature, are at the bottom. This category of needs includes on one level all attempts of the body to maintain certain chemical balances (such as water, oxygen, and hydrogen ion levels). On a higher level, the physiological needs include the individual’s desires for food, sex, sleep, sensory pleasures, and sheer activity (meaning the need to be busy).
The need for safety, which is next in prepotence, may include the desires of the individual for security, order, protection, and family stability. The next category, belongingness and love, may include, among