The Economic Importance of Tertiary and Quaternary Industry World Geography The Economic Importance of Tertiary and Quaternary Industry

The economic importance of the tertiary and quaternary sectors (1) Diversifies the economy- allows for more individuals to move out of the primary and secondary sectors which is beneficial to a country’s economy. This allows for people in developing countries to learn skills that will benefit the economy and move the country forward. (2) Contributes to country’s GDP- these sectors produce over 70% of the GDP in many countries. (3) Improved standards of living- this is especially true for the tertiary industry of tourism in less developed countries because their economies are so dependent on the tourist trade (4) Growth stimulates more growth- as the country benefits from the increase growth of the tertiary and quaternary industries, the growth feeds off itself. By this we mean that as the economy grows and the standard of living improves

Issues that affect the viability of a tertiary activity. The tertiary industry is a growing sector It has seen constant growth over the past 100 years The multiplier effect is in part responsible for this phenomenon As the secondary sector of the economy grew, there were more people working in urban areas as manufacturers. The concentration of people meant there was more need for services. Service industries grow in turn. The people working in the tertiary industry need services too so the growth of the service industry continues.

Issues that affect the viability of a tertiary activity. Population size/location The population needs to be large enough to support service industry, and must be located where they can access the services Type of service and price There must be a demand for the service. It must be affordable Quality a. The quality of the service provided must attract customers.

The economic importance of the quaternary sector. The quaternary sector of the economy is important for many reasons It is the area of the economy that allows for companies to research cost cutting methods, new markets, innovation, and new methods of production In the quaternary sector companies can use investments to plan for future expansion, or to gain higher returns on investment The quaternary sector is most valuable because it allows companies to create new products from which they can make a profit Remington Fusion Venus

Factors that affect the growth of the quaternary sector. Increased demand: As tertiary industries grow there is an increased demand for innovation, and investment Development of communication Technology: Over the past 20 years there have been major improvements in the ability of developing countries to communicate. This allows the outsourcing of jobs to new markets Increased education: More people are seeking higher education and are now able to fill roles in the information/research and development positions.

Impact of developments in the quaternary sector. Economic impact: 1) Diversification of economy creating more jobs within the country 2) Growth of a country’s GDP 3) Improve foreign trade relations with the world 4) Increase tax base for the country Social impact: More opportunities to reinvest in fundamental programs such as education and health care 2) Improved standard of living for its citizens 3) Opportunities for the country to increase its foreign aid commitment to less fortunate countries.