Meaning Types & Sector of Economy

Economics: It is the social science that analyzes the production, distribution and consumption of goods and services. It is subdivided in to Microeconomics which examines the behavior of firms, consumers and the role of government and Macroeconomics which deals with inflation, unemployment, industrial production and the role of the government.

Types of Economy:

Socialistic Economy: it is characterized by existence of public enterprise or state ownership of capital in all the important spheres of economic activity.

Capitalistic economy: it is characterized by existence of private enterprise and ownership of all important sectors of production.

Mixed economy: In a mixed economy, the government will provide essential goods and services which the market fails to produce well. In this system, Public and private sectors co-exist. India’s economy is a mixed economy.

Sectors of Economy:

Primary Sector: The primary sector of the economy makes direct use of national resources. This includes agriculture, roaster and fishing, mining, extraction of oil and gas. Primary sectors of Indian economy is agriculture and the related sectors.

Secondary sector: This sector generally takes the output of the primary sectors and manufactures finished goods. All industrial production where physical goods are produced come under the secondary sectors.

Tertiary Sector: It involves providing intangible goods like services. Financial Services, management, consultancy, and IT good examples of service sectors.