In economics a necessity good is a type of normal good. Like any other normal good, when income rises, demand increases. But the increase for a necessity good is less than proportional to the rise in income, so the proportion of expenditure on these goods falls as income rises. This observation for food is known as Engel's law. The income elasticity of a necessity good is thus between zero and one.
Necessity goods are goods that we can't live without and won't likely cut back on even when times are tough, for example food, power, water and gas.
