The Tertiary Sector: Services in the Economy
What is the Tertiary Sector?
The tertiary sector provides services to the general population and businesses. These services may include transport, communications, trade, tourism, healthcare, and education.
Types of Services Provided by the Tertiary Sector
There are two main types of services provided by the tertiary sector:
- Private services are provided by businesses to obtain a profit. These services are paid for directly by consumers.
- Public services are provided by the state to improve the quality of life for citizens. These services are paid for through taxes.
Subsectors of Services
The services provided by the tertiary sector can be grouped into four subsectors:
- Services to businesses, provided by banks and consulting agencies
- Services to society, such as healthcare, education, and public administration
- Services to the final consumer, such as hotels, restaurants, and hairdressers
- Distribution services, such as transport and storage, post office, and trade
Differences Between the Services Sector in Developed and Underdeveloped Countries
The services sector in developed countries is characterized by:
- A wide range of services that provide jobs for a large portion of the population, including women
- A focus on social services and business services
In contrast, the services sector in underdeveloped countries is characterized by:
- A predominance of low-qualification services, such as street selling
- Limited access to services for most of the population
- A lack of employment opportunities in the services sector
Location of Services
The most advanced and specialized services are typically located in large cities. However, in developed countries, improvements in transport and telecommunications are allowing these services to move to mid-sized and smaller towns.
Less specialized services, such as trade, are distributed more evenly throughout the territory.
The Transport Systems
In a globalized world, transport systems play a crucial role in facilitating economic and social activities. They are essential for the logistics of businesses and governments, which invest heavily in ports, airports, roads, and railways.
Improvements in transport infrastructure have led to faster, safer, and more efficient transportation networks, with increased autonomy and capacity.
The Information Society
In modern society, advancements in information technologies and communication have made the creation, distribution, and manipulation of information the most significant economic and cultural activity.
The Information Superhighway
The information superhighway is an extensive electronic network, such as the internet, used for the rapid transfer of sound, video, and graphics in digital form. It is revolutionizing the way we work, research, and communicate.
Trade
Trade is a commercial transaction involving the sale and purchase of goods, services, or information.
Types of Internal Trade
Internal trade is conducted within the political and geographical boundaries of a country.
- Wholesale trade involves buying in large quantities from producers and selling in lots to retailers. Wholesale markets are typically concentrated in the outskirts of cities.
- Retail trade involves selling directly to consumers in street markets, small shops, supermarkets, or superstores.
Foreign Trade
Foreign trade is the exchange of goods and services between countries. It comprises two main activities:
- Importing (buying goods from foreign sellers)
- Exporting (selling goods to foreign buyers)
The balance of trade shows the difference between the monetary value of imports and exports.
Characteristics of Foreign Trade
Improvements in transportation, the international division of labor, and the need for countries to purchase goods and services that they do not produce have led to the growth of foreign trade worldwide.
Machinery, transportation equipment, and textiles account for the majority (70%) of goods traded internationally.
To facilitate trade and act as a bloc in international markets, neighboring countries often eliminate customs barriers and form international organizations such as the World Trade Organization (WTO) to reduce trade barriers.
Areas of Foreign Trade
The main areas of foreign trade are the United States, the European Union, and Japan. Other countries have a smaller share, with some Middle Eastern countries playing a significant role in oil exports and China, India, and the Newly Industrialized Countries (NICs) gaining prominence in the export of manufactured goods.
Tourism
Tourism is the temporary movement of people for more than 24 hours for leisure purposes. It has become a mass phenomenon due to increased living standards, increased leisure time, improved transportation and tourist infrastructure, and promotion by travel agencies and tour operators.
Types of Tourism
There are four main types of tourism:
- Water-based tourism, including sun and beach tourism, nautical tourism, and spa tourism
- Mountain tourism, with activities such as hiking, camping, and skiing
- Rural tourism, with activities such as hunting and traditional agricultural activities
- Urban tourism, with cultural, business, or religious visits
Principal Tourist Spaces
The main tourist destinations are Europe and the United States.