Characteristics of Wealth

Anything to be called wealth must possess the following characteristics:

Utility:

The first attribute of wealth is its capacity to satisfy a human want i.e. it must have utility. A rotten egg has no utility. It cannot be wealth. Utility is not the same thing as usefulness. A good may not be useful but it may satisfy a human want. Wine is not useful but satisfies human want. Hence wine is wealth in economics.

Scarcity:

A good may have utility but cannot be termed as wealth if it does not possess scarcity. In other words it must be limited in supply in relation to demand. Air, sunshine have utility but no scarcity. Hence they are not wealth in economics. Since they are available in plenty, no payment is necessary to use them.

Only economic goods are wealth as they are limited in supply. We pay a price to purchase or use them.

Marketability:

Another important attribute of wealth is the marketability. A commodity is marketable if it is transferable. If the ownership of a thing can be transferred, it is said to be marketable. In this sense building is wealth as it’s transferred, it is said to be marketable. In this sense building is wealth as its ownership can be transferred. In this sense the B.A. certificate of a student is not wealth as it is not marketable or transferable. Similarly health is not wealth in economics as it is not marketable. Viewed in this sense personal qualities like ability, intelligence and talent of a painter, artist, poet etc. are not wealth.

External Possession of Man:

Anything to be wealth must be an external possession of man. It should not be an internal quality of a person like the skill of a surgeon or the talent of a singer which are not transferable.

From the above discussion, it is clear that a thing having utility, scarcity, transferability and external possession of man is called wealth. In Short, all economic goods are wealth.