The Tertiary Sector Is Going to Dominate the World Economy; Should We Worry?

Sultan, Muyed (2008): The Tertiary Sector Is Going to Dominate the World Economy; Should We Worry?

Abstract

This paper explains some practical experiences on service sector growth as well as its contribution to the economy throughout the world. In rich countries, service contributions are comparatively higher than that in poor countries. But service sector growth rates are higher in the poor countries in comparison to the rich counterparts. This study is a good witness to service sector’s supremacy in the present era. This paper is trying to reach a decision – weather high sectoral difference make disturbance to economic growth or not? It is found that high service sector share in the economy is a cause of slower economic growth. Nonetheless, in the long run, slower growth rates cannot make noteworthy disturbances to the economy. Because, service sector has a self correction motive through the income effect. Some policy suggestions are included here to manage short and mid term effects of high sectoral difference (high service contribution in the economy).

• Item Type: MPRA Paper
• Language: English
• Keywords: Economic Growth; Income Effect; Sectoral Participation Ratio; Service Sector Share; Tertiary sector
• Subjects: B - History of Economic Thought, Methodology, and Heterodox Approaches > B2 - History of Economic Thought since 1925 > B22 - Macroeconomics

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