Inferior goods are goods that become less attractive to consumers as their income increases. In other words, the demand for these goods decreases as income rises. Examples of inferior goods include:
Public transportation: As income increases, people are more likely to switch to private transportation like cars.
Generic products: As income increases, people may be more likely to switch to higher-quality, brand-name products.
Pre-owned goods: As income increases, people are more likely to buy new products rather than used or pre-owned goods.
Generally, inferior goods tend to be cheaper, lower-quality products that people consume out of necessity or due to limited budget constraints. They often serve a basic need or function, but are not seen as desirable or luxurious.
Inferior goods have a negative income elasticity of demand