In economics, derived demand refers to the demand for a resource, factor of production, or intermediate good that stems indirectly from the demand for the final product or service it helps to create. This concept highlights how the need for inputs depends on consumer preferences for outputs, influencing markets for labor, materials, and capital.

• Example: The demand for tyres arises from the demand for vehicles such as trucks, where tyres serve as essential components for operation or production, including in industries like mining that rely on heavy machinery.