Scarcity, an economic concept, refers to the basic life fact that there is only a finite amount of human, nonhuman resources where the best technical knowledge can produce only limited optimal amounts of each economic good. If the scarcity conditions didn't exist and an "infinite amount of each good could be produced, or the human wants fully satisfied, there exist economic goods; it means, relatively scarce goods. Scarcity is the limited availability of any commodity, which can be in demand in the market.
We all look at the ocean and reassure us that water is abundant and will last us till the infinity level. Prior to dwelling on this, let us take a detour.
Some express that money is the root of all evil. But it is a wonder, if we think about since money was invented by us, to connect humans with their needs. But our evolution as a species has made us consider the same money with a negative connotation. We have also descended down to the level where we are no longer having any regard for the food, shelter, and water provided to us.
If we consider this case, half of the world feasts producing enough wastes that could resultantly feed the hungry half of the world. This is one of the primary reasons for these grave scarcities. Also, it is an extremely easy leap to conclude that greed is the root of all evils. We also like to pretend that we have kept our own personal greed in check, which is not always true. If we look around, food scarcity, water scarcity it's all around us.
One should understand that anyone cannot wish the concept of scarcity to vanish. It is defined as a fundamental reality of economic life. However, we do not have a history of judicious use. But the need for both the judicious and environmentally healthy use of all the resources is the basic need of the hour. The oceans are draining, leading to water scarcity, and also, the glaciers are melting because of the global warming concept. The resources of the world are not what one would call fair or one that serves equality. Many people in developing nations are excessively facing food scarcity and water scarcity. Not only are humans suffering, but due to the greed of the human race, the animal kingdom is also becoming a victim of this scarcity.
Let us look at the prime types of scarcity.
Water scarcity is one of the primary causes of concern due to the reason that people die because of it. Most of us waste water because it is available for us at an abundant level all the time, we fail to imagine those places and countries where getting a glass of clean or pure water to drink is still a challenging task to manage. Not only this, water scarcity affects human beings, but also it affects the animals. Some of the root causes of the water scarcity are listed below:
Overuse of water due to ignorance
Natural calamities like Drought
Political conflict between states
Food shortage is another major issue which is being faced by the world for so long. The other name for food scarcity is defined as famine, which means extreme scarcity and severe food shortage. Famine is also an issue because various environmental issues lead to a shortage of food. A few reasons for the scarcity are listed below:
Scarcity of water or lack of rainfall
A scarce good has more quantity demanded compared to quantity supplied at a price of $0. Scarcity is the possible existence of conflict over the possession of any finite good. We can say that, for any scarce good, at times, control and ownership excludes the control of someone else.
Scarcity falls into 3 distinctive categories: supply-induced, demand-induced, and structural. Demand-induced scarcity takes place when the resource demand increases and the supply stays similar. Supply-induced scarcity takes place when a supply is very low to the demand. This mostly happens due to environmental degradation, such as drought and deforestation. At the same time, structural scarcity takes place when the population part doesn't have equal access to resources because of the location or political conflicts.
On the other side, there exist nonscarce goods. These goods do not require to be valueless, and a few can even be indispensable for one's existence. As Frank Fetter, in his Economic Principles, explains: "A few things, even which are indispensable to existence, may yet, due to their abundance, fail to be desired objects and of choice. Such things are referred to as free goods.
Q1. Explain the Terms Scarcity, Sufficiency, and Abundance?
Answer: Let us discuss the terms scarcity, sufficiency, and abundance as follows.
Relative scarcity is defined as a condition where multiple and different human requirements are greater compared to the available quantities with alternative uses.
Relative sufficiency is described as the condition where multiple and different human requirements and the available quantities with alternative uses are said to be equal.
Relative abundance can be described as the condition where the available quantities of useful goods, including alternative uses, are greater than the multiple and different human requirements.
Q2. List Some Examples of Scarcity?
Effect of Hurricanes - On a few occasions, Hurricanes which are around the Gulf Coast of the USA incapacitate oil refineries and render them useless, at least for a specific period. When this occurs, again, in accordance with the Pricing Theory, the price of the crude oil resultantly increases.
Q3. How Scarcity Affects Countries?
Answer: Factors such as production costs and labour majorly affect the cost of scarce items. If resources meet the unlimited wants and needs of a specific good, then it is not considered a scarce good. This would need the resources to be unlimited also for it to meet the unlimited demand.
Q4. List the Primary Factors of Scarcity?
Answer: Let us look at the major factors of scarcity.
Limited resource count, and more.