7.2 Economic Sectors and Patterns

The World Economy

The world economy can be separated into distinct categories called sectors. The easiest ways to group sectors are by their stage in the production process or through the types of services or products that they create.

Primary Production

🥦 Primary production refers to the extraction and production of raw materials, such as agricultural products, minerals, and forestry products. It is a key part of the primary sector of the economy.

Examples of primary production include:

• Farming: growing crops or raising livestock for food, fiber, or other products.
• Mining: extracting minerals, such as coal, metal ores, and oil, from the earth.
• Forestry: harvesting trees for wood and other products, such as paper.
• Fishing: catching and harvesting seafood.
• Quarrying: extracting stone, sand, and other materials for construction and other purposes.

Primary production often involves the use of natural resources and can have significant environmental impacts. As such, it is important for primary producers to consider sustainability in their operations.

Secondary Production

🏭 Secondary production refers to the processing of raw materials into finished goods, such as manufacturing, construction, and power generation. It is a key part of the secondary sector of the economy.

Examples of secondary production include:

• Manufacturing: converting raw materials into finished products, such as textiles, automobiles, and electronics.
• Construction: building infrastructure, such as roads, buildings, and bridges.
• Power generation: producing electricity from a variety of sources, including fossil fuels, nuclear energy, and renewable energy.

Secondary production often involves the use of specialized equipment and skilled labor, and can have significant economic and technological impacts. It is an important driver of economic growth and development in many countries.

Tertiary Production

🚚 Tertiary production refers to the provision of services, such as healthcare, education, and finance. It is a key part of the tertiary sector of the economy.

Examples of tertiary production include:

• Healthcare: providing medical services and treatments to individuals.
• Education: teaching and imparting knowledge to students.
• Finance: providing financial services, such as banking, investment, and insurance.
• Hospitality: providing accommodation, food, and other services to travelers.
• Retail: selling goods and services to consumers.

The tertiary sector is often considered to be the service sector of the economy, as it involves the provision of intangible goods and services rather than physical goods. It is an important contributor to economic growth and development, as it can create high-skilled, high-paying jobs and drive innovation.

Quaternary Production

💰 Quaternary production, also known as the quaternary sector of the economy, refers to activities that involve the creation and distribution of knowledge and information. It includes research and development, as well as the design and management of complex systems.

Examples of quaternary production include:

• Research and development: conducting scientific and technological research to advance knowledge and create new products and technologies.
• Information technology: designing, developing, and maintaining computer systems and software.
• Management consulting: providing advice and guidance to organizations on strategy, operations, and other business-related topics.
• Intellectual property: creating and protecting intangible assets, such as patents, trademarks, and copyrights.

Quaternary production is often associated with highly skilled and knowledge-intensive industries. It can drive innovation and competitiveness in the economy, and is an important contributor to economic growth and development.

Quinary Production

🏛 Quinary production, also known as the quinary sector of the economy, refers to the highest level of economic activity, which involves the decision-making and policy-making that drives the other sectors of the economy. It includes activities such as high-level management, administration, and policy development.

Examples of quinary production include:

• High-level management: making strategic decisions and setting the overall direction of an organization.
• Policy development: creating and implementing policies and plans at the national or international level.
• Government administration: managing the operations of the government and implementing policies.
• Think tank research: conducting research and providing analysis and recommendations on public policy issues.

Quinary production is typically carried out by highly educated and experienced individuals, and can have significant impacts on the direction and performance of the economy.

Courtesy of ResearchGate

Commodity Chain

A commodity chain is the series of activities that are involved in the production, distribution, and consumption of a particular product or commodity. It includes all of the steps, from the extraction of raw materials to the final sale of the finished product to the consumer.

The commodity chain can include activities such as raw material extraction, manufacturing, distribution, marketing, and retail. It can involve a wide range of actors, including primary producers, manufacturers, distributors, wholesalers, and retailers.

Understanding the commodity chain can help to reveal the various stages of production and distribution that are involved in bringing a product to market, and can provide insight into the social, economic, and environmental impacts of commodity production. It can also help to identify opportunities for improvement and innovation in the production and distribution process.

Break-of-Bulk Point

A break-of-bulk point is a location where the transfer of goods from one mode of transportation to another takes place, such as from a ship to a truck or from a train to a warehouse. It is a point in the supply chain where the movement of goods is transferred from one form of transportation to another, typically in order to reach the final destination.

Break-of-bulk points are important because they allow for the efficient movement of goods over long distances by enabling the use of different modes of transportation. For example, a ship may be used to transport goods from one country to another, and then a truck or train can be used to transport the goods to the final destination within the country.

Break-of-bulk points can be found at ports, airports, rail yards, and other locations where different modes of transportation intersect. They play a crucial role in the global supply chain, as they facilitate the movement of goods and materials around the world.

Trading Between Countries

In world trade, core (a.k.a MDCs, First World, etc.) countries have the advantage in trade over semi-periphery and periphery countries.

Semi-Periphery

The semi-periphery is a term used in the field of economic geography to describe a group of countries that are located between the core and the periphery. The core refers to the highly industrialized, economically advanced countries that dominate the global economy, while the periphery refers to the less industrialized, less economically developed countries that are often dependent on the core countries.

The semi-periphery occupies a middle ground between the core and the periphery, and often has a mix of characteristics from both. These countries may have some industrialization and economic development, but they are not as advanced as the core countries and often have a lower level of global economic influence.

Examples of countries that might be considered part of the semi-periphery include Brazil, Russia, India, and China. These countries have experienced significant economic growth and development in recent years, but they are still not as economically advanced as the core countries of the global economy.

Periphery

The periphery refers to the less industrialized, less economically developed countries that are often dependent on the more economically advanced, industrialized countries, also known as the core. The periphery is often characterized by a lack of economic and political power, and may be heavily dependent on the core countries for trade, investment, and other forms of economic support.

Examples of countries that might be considered part of the periphery include many countries in Africa, Latin America, and parts of Asia. These countries often have lower levels of economic development and industrialization compared to the core countries, and may be more vulnerable to external economic and political pressures.

It is important to note that the concept of the periphery is a relative one, and the classification of a country as part of the periphery can vary depending on the specific criteria being used.

Deindustrialization

Deindustrialization refers to the process of a country or region experiencing a decline in its industrial sector, often characterized by the loss of manufacturing jobs and the closure of factories. It can be driven by a variety of factors, including technological change, globalization, and shifts in economic policy.

Deindustrialization can have a number of negative impacts on a country or region, including rising unemployment, declining incomes, and social unrest. It can also lead to a loss of competitiveness in international markets and a decline in the overall standard of living.

There are a number of ways in which governments and communities can respond to deindustrialization, such as by investing in education and training to help workers adapt to new industries, supporting the development of new businesses and industries, and implementing policies to promote economic development and growth.

Examples of countries or regions that have experienced deindustrialization include:

• The United States: The U.S. has undergone a significant shift away from manufacturing and towards a service-based economy, leading to the loss of millions of manufacturing jobs. This has been driven by factors such as technological change, globalization, and shifts in economic policy.
• The United Kingdom: The UK has also experienced significant deindustrialization in recent decades, with the decline of industries such as coal mining, steel production, and shipbuilding. This has contributed to economic and social challenges in many communities that were previously reliant on these industries.
• The Rust Belt in the United States: The Rust Belt is a region in the U.S. that stretches from New York to Illinois and includes states such as Ohio, Pennsylvania, and Michigan. It was once a hub of heavy industry, but has experienced significant deindustrialization in recent decades due to the loss of manufacturing jobs and the closure of factories.

Deindustrialization is a complex process that can have significant impacts on communities and economies, and can be difficult to address.