Economic Motives: Definition, Objectives, Types of Economic Motives

This article briefly reviews economic motives, ranging from their definitions, goals, to types.

Understanding Economic Motives

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Actually, what is meant by economic motives? Understanding economic motives are all related to reason, motivation or encouragement, and activities carried out by individuals or organizations to carry out an economic activity.

This term can also be defined as a fundamental reason why individuals and organizations carry out an economic activity. Generally humans carry out economic activities aimed at fulfilling their needs, ranging from primary, secondary, to tertiary needs.

The word “motive” comes from the English language, which is “motive” which means a reason or a person to do something. So in this case, the notion of economic motives is any action or deed done by someone that is driven by a reason to achieve a goal.

Motives or desires in economic activities can arise from within (intrinsic) and can also be due to the influence of the environment (extrinsic).

  1. Intrinsic Motive; namely the motives that arise in a person without the influence of external factors. Example; when someone feels thirsty and hungry, then he will buy food and drinks to consume.
  2. Extrinsic Motives; namely the motives that arise in a person because of the influence of external factors or from the environment. Example; when someone sees a new laptop belonging to a friend, then inside that person arises the desire to buy a new laptop.

Also read: Understanding Economics

Purpose of Economic Motives

Referring to the explanation above, the purpose of economic motives is to fulfill human needs in his life. In general, there are three human needs, namely:

  1. Primary Needs, namely basic human needs such as food and drink, clothing, and shelter.
  2. Secondary Needs, namely additional needs to support human primary needs such as vehicles, television, magazines, books, and so forth.
  3. Tertiary Needs, namely human needs that are prestigious or something that is considered to be able to lift a person’s degree, such as musical instruments, luxury homes, sports equipment, and others.

Also read: Definition of consumption

Various Types of Economic Motives

Also read: Understanding of Economic Performers

Economic motives can be distinguished based on economic actors, namely individual motives and organizational motives. The following explanation:

A. Individual Motives

Individual motives are motives that are based on encouragement from within oneself to improve economic conditions and prosper for themselves and their families. Some of the individual motives include:

  1. Motives for Improving Living Standards

All humans naturally try to fulfill their physical and spiritual needs. That way, he tries to improve his standard of living, which is a balanced condition between needs and needs.


  • Eat healthy foods so that the body remains healthy and strong so that it can work.
  • An employee changes jobs or works harder to get a promotion so that he can increase his income.
  1. Motive for Self Actualization

In general, humans need recognition and appreciation from others. This is one of the reasons for someone to carry out economic activities.


  • A student is willing to study more so that he can take the exam with good grades so he gets an award from the teacher, friends, and parents.
  • Someone buys a private vehicle, buys good clothes, and so on, to fulfill his desire to look successful in the eyes of others.
  1. Motives for Achieving Economic Power

Most business people would want to have economic power in the industry that they do. It is also not uncommon for entrepreneurs to make various efforts and ways for their businesses to become market rulers to obtain greater profits.


  • An entrepreneur offers his business franchise to others so that other people sell their products and reduce competition.
  • A restaurant entrepreneur regularly opens new branches in other areas to expand his business network and increase his economic power.
  1. Social Motives

There are also some people who carry out economic activities because they are based on social motives. This is because there is a desire to help and prosper for others.


  • An entrepreneur establishes a cooperative for the benefit of its members.
  • A businessman establishes a business and employs his family or friends.

B. Organizational Motives

Organizational or organizational motives are motives that are based on the desire of a group to improve the economic members of the group by working together. Some of the organizational motives include:

  1. Motives for Production of Goods

A company seeks to produce goods or services at low prices with good quality. It aims to get a certain portion of the market in a sustainable manner.

Example; an entrepreneur makes a product that many people are looking for by using cheap but still quality raw materials.

  1. Motives for Profit

The main reason for a company carrying out economic action is to make a profit. With the benefits, an organization or company can carry out their economic activities on an ongoing basis.

Example; a trader offers his product to others by giving discounts and good service so that the product is purchased.

  1. Motives for Maintaining Company Continuity

Although there are many who build companies, but not all of them can maintain their existence. This is the reason for all companies to always try to generate profits in a sustainable manner so that the company’s activities can continue to operate.

Example; a businessman cooperates with many parties by offering lower prices so that the business continues to run even though the profit is not too big.

Also read: Understanding Business

Thus a brief description of the understanding of economic motives, goals, and their kinds. Hopefully this short article is useful and adds to your insight.


by Abdullah Sam
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