Final answer:
The theory that outlines five basic levels of human needs in a hierarchical structure is known as Abraham Maslow's hierarchy of needs, progressing from physiological needs up to the need for self-actualization.
Step-by-step explanation:
The theory that postulates five basic levels of human needs based on their importance is Abraham Maslow's hierarchy of needs. At the base of this hierarchy are physiological needs necessary for survival, such as food, water, and shelter. Once these are satisfied, individuals can address higher-level needs.
The next levels include needs for security and safety, social needs like love and belonging, esteem needs that encompass self-worth and confidence, and finally, at the top of the pyramid, the need for self-actualization. This last need relates to achieving one's full potential and reflects the humanistic emphasis on positive aspects of human nature.
Maslow also suggested the concept of self-transcendence, which represents striving for meaning and purpose beyond oneself, although this is sometimes debated and not always included in representations of the hierarchy. Criticism of Maslow's theory notes its subjective nature and challenges in accounting for real-world phenomena. Nonetheless, it remains a fundamental concept in understanding human motivation and behavior.