Maslow's Pyramid Today

Abraham Maslow, in his 1943 paper "A Theory of Human Motivation" and later in his 1954 book “Motivation and Personality” presented his now justly famous hierarchy of needs (also called the motivational pyramid). Maslow views human behavior as being driven towards the satisfaction of five basic needs. The hierarchy means that once a lower level need is fulfilled, the next level of the hierarchy becomes the motivator. The lowest need is the physiological one (including food, water, shelter, heating and energy). Once the physiological needs are met, the next priority relates to safety (personal security, health, property). Such needs being fulfilled humans are driven by the need for love and social belonging (family, friends, sense of connection), and thereafter self-esteem (self-confidence, peer respect), and finally what Maslow called self-actualization (the desire to fulfill one’s potential).

Maslow’s insight was the result of his own search for the meaning of life in his age. He noticed that the pursuit of money and fame had replaced previous aims dictated by religion and custom. However, Maslow was concerned that during his day too much economic activity was directed at the lowest levels of the hierarchy, and too little at the loftier tiers. In particular big business focused on the basic physiological needs (industrial agriculture, food manufacturing, supermarket chains, building contractors) and on safety needs (pharmaceutical industry, medical profession, home security, firearms industry), but the third level of social belonging was only being addressed by telephone companies enabling communication with family and friends. Higher levels of the pyramid, such as self-esteem and fulfillment, were being completely ignored. Maslow strongly believed that a corporation could profit from fulfilling higher needs, although he did not provide specific suggestions as to how this could be accomplished.

Fast forward 75 years and none of the world’s wealthiest corporations (Apple, Microsoft, Amazon, Alphabet, Berkshire Hathaway, Facebook, Alibaba, Tencent, Visa and JPMorgan Chase) derive most of their economic activity from the lower levels of Maslow’s pyramid. In fact, the only food related activity at all is Amazon’s venture into selling food, with revenues only a small fraction of Amazon’s pie. Of course Microsoft, Amazon, and Alphabet support the modern working environment and hence indirectly support shelter and property; Berkshire Hathaway,Tencent’s WeBank, Visa and JPMorgan Chase all support financial needs which can be understood to map to Maslow’s lower layers; and Amazon and Alibaba sales engines provide property (although usually not property required at the lowest levels). However, all of these companies are enablers or middle-men, not providers. The “products” that these companies sell are ease of acquisition, instant satisfaction, and discovery of needs that the consumer didn’t know he had, which don’t map to lower Maslow levels.

What needs do these companies serve? Facebook, Tencent’s QQ and other social networks such as Microsoft’s LinkedIn have discovered how to monetize the fulfillment of social belonging and the sense of connection. Apple’s iPhone ostensibly provides connectivity with family and friends, but in reality as a luxury item supports self-esteem. Tencent’s gaming platform also derives its appeal from self-esteem and even self-actualization. And outside the top ten there are myriads of web sites dedicated to finding love (or at least potential love partners), community, and lost branches of family trees, and an unending stream of books and video guides on self-improvement, finding health, wealth, and happiness, and being more creative.

Were Maslow to drop in for a visit he would doubtless be astounded, and probably feel vindicated, but would he be satisfied? Based on what we have seen so far I think not, for a top-heavy pyramid is necessarily unstable. Basic needs at the bottom levels of the hierarchy have not vanished - who is taking care of them?

But I have presented a distorted story! The aforementioned list of corporations was in fact the ten largest corporations by market cap (i.e., as ranked by investors belief in growth potential). None of these companies appears in the list of the ten largest corporations by revenue (i.e., ranked by real-world economic activity), although Apple and Amazon are in the top 20, and Apple, JPMorgan Chase, and Alphabet are also in the top 10 by profit (i.e., ranked by overcharging for their services).

The top corporation by revenue is Walmart, which retails food and household items - definitely focusing on Maslow’s lowest level. The next seven corporations on this list are in the energy sector (Sinopec (China), Royal Dutch Shell and China National Petroleum all in oil and gas, China State Grid in electricity, Saudi Aramco, BP, and ExxonMobil in oil and gas) – also mapping to the bottom level. These are followed by Volkswagen and Toyota in the automotive sector, which might have been considered a luxury sector in Maslow’s time (in contrast to public transportation), but is arguably in the lowest level today.

The current pyramidal situation is accordingly (at least from the point of view of the largest corporations) that the real economy is still bottom heavy while the stock market is top heavy. Which is probably a healthy sign. The largest portion of the real economy goes towards sustenance, warmth and transportation, while our belief in the future is invested in friendship, self-esteem, and a fulfilled life.

I think Maslow would be pleased at last.