Necessity vs. Commodity — What's the Difference?
By Tayyaba Rehman & Maham Liaqat — Updated on March 25, 2024
Necessity refers to essential needs for survival, like food and shelter, while a commodity is a marketable item produced to satisfy wants or needs.
Difference Between Necessity and Commodity
Table of Contents
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Key Differences
Necessity encompasses basic requirements crucial for maintaining life and well-being, such as food, water, and shelter. These are items that individuals need to survive and maintain health. Without necessities, a person's ability to live is significantly compromised, underlining their importance for survival and basic functioning. On the other hand, a commodity refers to a basic good used in commerce that is interchangeable with other goods of the same type. Commodities are often raw materials like metals, oil, or agricultural products but can also include more refined products that have a wide market.
Necessities are often prioritized in personal and societal budgets due to their fundamental role in life. In contrast, commodities, particularly non-essential ones, might be subject to fluctuating demand based on economic conditions, preferences, and availability. This prioritization reflects the intrinsic value of necessities in supporting life and basic human functions.
While necessities are typically consumed directly by the end-user to meet basic needs, commodities are usually traded globally and are key to various industries. They play a significant role in the economy, affecting and being affected by global market trends, trade policies, and economic health.
The distinction also lies in the perception and elasticity of demand. Necessity goods have inelastic demand; people need them regardless of price changes. Commodities, especially non-essential ones, often have more elastic demand, meaning their purchase can be delayed or substituted based on price and income changes.
Comparison Chart
Definition
Essential needs for survival and well-being.
Marketable items produced to satisfy wants or needs.
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Examples
Food, water, shelter.
Oil, gold, wheat.
Demand Elasticity
Inelastic - demand remains constant despite price changes.
Variable - can be inelastic or elastic depending on the commodity.
Primary Function
To ensure survival and maintain health.
To be traded or used in production.
Economic Importance
Fundamental for life, not influenced by market trends.
Influenced by and affects global market trends.
Compare with Definitions
Necessity
Necessities are critical for maintaining life and health.
Access to clean water is a necessity for health.
Commodity
Commodities are often standardized and interchangeable with other similar goods.
One bushel of wheat is considered equal to another of the same grade.
Necessity
Individuals and societies prioritize necessities in their budgets.
Families allocate a significant portion of their budget to housing, a basic necessity.
Commodity
Demand can be elastic or inelastic, influenced by necessity, luxury status, and substitutes.
Luxury commodities like diamonds have a more elastic demand than staple foods.
Necessity
Demand remains relatively constant regardless of price changes.
Demand for basic food items remains stable even as prices fluctuate.
Commodity
A commodity is any good exchanged in commerce.
Crude oil is a highly traded commodity in global markets.
Necessity
Items or conditions without which a person cannot survive or maintain health.
In cold climates, adequate heating is a necessity.
Commodity
Commodity prices can indicate economic health and trends.
Rising gold prices often signal economic uncertainty.
Necessity
Lack of alternatives; necessities must be met with specific goods or conditions.
Shelter is a necessity that cannot be overlooked during extreme weather conditions.
Commodity
Prices and demand for commodities are influenced by market conditions.
A surplus in oil production can lead to lower fuel prices.
Necessity
The condition or quality of being necessary.
Commodity
In economics, a commodity is an economic good, usually a resource, that has full or substantial fungibility: that is, the market treats instances of the good as equivalent or nearly so with no regard to who produced them.The price of a commodity good is typically determined as a function of its market as a whole: well-established physical commodities have actively traded spot and derivative markets. The wide availability of commodities typically leads to smaller profit margins and diminishes the importance of factors (such as brand name) other than price.
Necessity
Something necessary
The necessities of life include food, clothing, and shelter.
Commodity
Something useful that can be turned to commercial or other advantage
"Left-handed, power-hitting third basemen are a rare commodity in the big leagues" (Steve Guiremand).
Necessity
Something dictated by invariable physical laws.
Commodity
A product or service that is indistinguishable from ones manufactured or provided by competing companies and that therefore sells primarily on the basis of price rather than quality or style.
Necessity
The force exerted by circumstance.
Commodity
(Archaic) Advantage; benefit.
Necessity
The state or fact of being in need.
Commodity
Anything movable (a good) that is bought and sold.
Necessity
Pressing or urgent need, especially that arising from poverty.
Commodity
Something useful or valuable.
Necessity
The quality or state of being necessary, unavoidable, or absolutely requisite.
I bought a new table out of necessity. My old one was ruined.
Commodity
(economics) Raw materials, agricultural and other primary products as objects of large-scale trading in specialized exchanges.
The price of crude oil is determined in continuous trading between professional players in World's many commodities exchanges.
Necessity
The condition of being needy; desperate need; lack.
Commodity
(marketing) Undifferentiated goods characterized by a low profit margin, as distinguished from branded products.
Although they were once in the forefront of consumer electronics, the calculators have become a mere commodity.
Necessity
Something necessary; a requisite; something indispensable.
A tent is a necessity if you plan on camping.
Commodity
(Marxism) Anything which has both a use-value and an exchange-value.
Necessity
Something which makes an act or an event unavoidable; an irresistible force; overruling power.
After eating a full meal, the human body's necessity for food will compel the person to eat again in the future.
Commodity
(obsolete) Convenience; usefulness, suitability.
Necessity
The negation of freedom in voluntary action; the subjection of all phenomena, whether material or spiritual, to inevitable causation; necessitarianism. en
Commodity
(obsolete) Self-interest; personal convenience or advantage.
Necessity
(legal) Greater utilitarian good; used in justification of a criminal act.
Doctrine of necessity
Commodity
Convenience; accommodation; profit; benefit; advantage; interest; commodiousness.
Drawn by the commodity of a footpath.
Men may seek their own commodity, yet if this were done with injury to others, it was not to be suffered.
Necessity
Indispensable requirements (of life).
Commodity
That which affords convenience, advantage, or profit, especially in commerce, including everything movable that is bought and sold (except animals), - goods, wares, merchandise, produce of land and manufactures, etc.
Necessity
The quality or state of being necessary, unavoidable, or absolutely requisite; inevitableness; indispensableness.
Commodity
A parcel or quantity of goods.
A commodity of brown paper and old ginger.
Necessity
The condition of being needy or necessitous; pressing need; indigence; want.
Urge the necessity and state of times.
The extreme poverty and necessity his majesty was in.
Commodity
Articles of commerce
Necessity
That which is necessary; a necessary; a requisite; something indispensable; - often in the plural.
These should be hours for necessities,Not for delights.
What was once to meMere matter of the fancy, now has grownThe vast necessity of heart and life.
Necessity
That which makes an act or an event unavoidable; irresistible force; overruling power; compulsion, physical or moral; fate; fatality.
So spake the fiend, and with necessity,The tyrant's plea, excused his devilish deeds.
Necessity
The negation of freedom in voluntary action; the subjection of all phenomena, whether material or spiritual, to inevitable causation; necessitarianism.
Necessity
The condition of being essential or indispensable
Necessity
Anything indispensable;
Food and shelter are necessities of life
The essentials of the good life
Allow farmers to buy their requirements under favorable conditions
A place where the requisites of water fuel and fodder can be obtained
Common Curiosities
What defines a necessity?
A necessity is defined as a basic need or requirement essential for survival and maintaining health.
Can a commodity be a necessity?
Yes, some commodities like food can also be necessities if they are essential for survival.
How does the concept of scarcity relate to necessities and commodities?
Scarcity can increase the value of both necessities and commodities, but necessities are prioritized due to their essential role in survival.
How do market forces affect commodities and necessities differently?
Commodities are subject to market fluctuations, whereas necessities have a stable demand regardless of economic conditions.
Are all commodities traded globally?
While many commodities are traded globally, some may have more localized markets depending on their nature and demand.
Is water considered a necessity or a commodity?
Water is a necessity due to its essential role in survival, but it is also traded as a commodity in some markets.
What role do commodities play in the economy?
Commodities are fundamental to the global economy, affecting and reflecting market trends, production, and trade policies.
Can the classification of a commodity as a necessity change over time?
Yes, changes in societal needs, technology, and resources can shift the classification of certain commodities.
What impact do environmental factors have on necessities and commodities?
Environmental factors can affect the availability and demand for both, but necessities are often more directly impacted due to their essential nature.
Why is the demand for necessities inelastic?
Because necessities are essential for survival, their demand remains constant even when prices change.
What are the consequences of not meeting necessities?
Failure to meet necessities can lead to health issues, decreased quality of life, and in extreme cases, mortality.
How do societal perceptions affect the classification of necessities?
Societal perceptions, influenced by cultural, environmental, and economic factors, can determine what is considered a necessity.
How do technological advancements affect commodities?
Technological advancements can alter production, efficiency, and the types of commodities available or in demand.
How do economic downturns affect the demand for necessities and commodities?
Economic downturns may reduce demand for certain commodities due to decreased spending power, but necessities remain in constant demand.
What is the relationship between commodities and industrial production?
Commodities are often raw materials for industrial production, influencing and being influenced by industrial demand and output.
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Written by
Tayyaba RehmanTayyaba Rehman is a distinguished writer, currently serving as a primary contributor to askdifference.com. As a researcher in semantics and etymology, Tayyaba's passion for the complexity of languages and their distinctions has found a perfect home on the platform. Tayyaba delves into the intricacies of language, distinguishing between commonly confused words and phrases, thereby providing clarity for readers worldwide.
Co-written by
Maham Liaqat
