What is the definition of Luxury goods?

• Answer by Tory Simpson
• 3rd Sep, 2021

In the language of economics, a luxury good is a type of good for which demand increases in a greater proportion with the increase in income. This results in the expenditures on the luxury good becoming a greater proportion of overall spending. Luxury goods are different to to necessity goods, as in the case of necessity, the demand increases proportionally less than income.