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Economic activity is any action that involves the development, production, transfer or consumption of goods or capital. The following are the common types of economic activity.ProductionThe creation of goods. This occurs at several different levels known as economic sectors:| Sector | Definition | Examples | | Primary Sector | The production of raw materials. | Agriculture, fishing, mining and forestry. | | Secondary Sector | The production of finished products. | Manufacturing of technology, fast moving consumer goods, furniture, vehicles and clothing. | | Tertiary Sector | The delivery of intangible value commonly known as services. | Information technology services, finance, entertainment, games, music, events, culture, community services, healthcare, hospitality, travel, business services, advertising, media and product as a service. | | Quaternary Sector | The delivery of services that are knowledge-intensive. | Consulting, professional services and business process outsourcing. | | Public Sector | Value created by governments. | Security, safety, infrastructure, education and healthcare services. | | Voluntary Sector | Value created without a paycheck. | Community volunteers and work within a family such as a grandfather who babysits. |
Some academics reference another sector known as the Quinary Sector (5th sector) that represents decision making and strategy. For example, management consulting and perhaps minor elements of investment banking. This is a small industry that fits well into the Quaternary Sector (4th sector) with other consulting and business services. The Quinary Sector is essentially a silly academic idea because most decision making and strategy is tightly bound to other industries and is the last thing that would ever be outsourced.
LaborOffering your talents to a business, government, non-profit or individual in return for compensation.MarketingThe end-to-end process of developing, producing, promoting, pricing, selling and distributing products and services.ConsumptionThe process of researching, purchasing and using products and services. For example, shopping and traveling are economic activities.
Research & DevelopmentThe process of discovering knowledge and developing new products, services, experiences, processes, methods, components and materials.Launching new businesses that offer value to markets. An important economic activity that creates economic change.InvestingPutting capital to work in an efficient way to earn a return. For example, investing in a company that produces products and services.
An attempt to profit due to price changes without creating any value. For example, buying gold because you feel the price of gold will increase doesn't create value but can result in a transfer of wealth.Rent SeekingRent seeking is any activity that pursues wealth or income without adding value. For example, a lobby group that seeks subsidies or special treatment from a government.
Creating negative economic value. For example, a fishing boat that loses a large net in the ocean such that it adds to the problem of ocean plastic.|
| Type | | | Definition | Any action that involves the development, production, transfer or consumption of goods or capital. | | Related Concepts | |
Economics
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