In economics, a product whose demand rises when consumers’ incomes fall is called an inferior good.
“Inferior” refers to the relationship between income and demand, not necessarily to poor quality. When income increases, consumers may replace such a product with a preferred alternative; when income decreases, they may buy more of the lower-cost option. Examples can vary by person, place, and income range, so no product is automatically inferior for every consumer.
This concept differs from a normal good. Demand for a normal good generally increases as income increases. A special case is a Giffen good, for which a price increase can increase quantity demanded under restrictive conditions. Every Giffen good is an inferior good, but most inferior goods are not Giffen goods.
Economists often examine income effects using household surveys, spending patterns, and demand estimates. The classification can change as tastes, available substitutes, and a household’s financial position change. It describes demand behavior, not an objective ranking of products.