Explaining the Service Sector in the Global Economy

Document Type : Promotional article

Author

Ph.D graduate at University of Tehran

Abstract

 There are two main sectors in the global economy: the manufacturing sector and the service sector. Over the years, the manufacturing sector became the most important sector of the economy and attracted attention. The main reason for this attention can be found in the writings of Adam Smith, who stated that "the productivity of this sector is much higher than others." In view of Smith, activities are "constructive" that lead to the production of visible goods. Other activities are unproductive, even if they are beneficial to people's well-being because they do not produce visible and exported goods. Thus, production was considered the most crucial part of the economy. The lack of attention from researchers and paying less attention to the service sector made this crucial part of the global economy less important than the production sector, and the principles of this sector were defined under the dominance of the concepts of the production sector. Since the 1980s, the GDP increase has often originated from the industries related to the service sector. This attracted researchers' attention to the service sector, and more research was conducted in this regard. Some terms, including "Service economics," "post-industrial society," and "the growth of the third sector," have emerged due to the importance of this sector. In this study, we attempt to eliminate the existing misconceptions about post-production services and paying less attention to the service sector than production in the supply chain with an in-depth look at the literature. We also try to explain the importance of the sector in the global economy. 

Keywords

References

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History

  • Receive Date: 21 December 2019
  • Revise Date: 08 February 2020
  • Accept Date: 16 February 2020

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