Macroeconomics (from the Greek prefix ''makro-'' meaning "large" + ''economics'') is a branch of economics dealing with performance, structure, behavior, and decision-making of an economy as a whole.
For example, using interest rates, taxes, and ...
, the secondary sector of the economy is an
Image:Economic sectors and income.JPG, 250px, This figure illustrates the percentages of a country's economy made up by different sectors. The figure illustrates that countries with higher levels of socio-economic development tend to have proportio ...
The three-sector model in economics
Economics () is the social science that studies how people interact with value; in particular, the Production (economics), production, distribution (economics), distribution, and Consumption (econom ...
that describes the role of
Manufacturing is the creation or Production (economics), production of goods with the help of equipment, Work (human activity), labor, machines, tools, and chemical or biological processing or formulation. It is the essence of secondary sector ...
. It encompasses industries
Produce is a generalized term for many farm-produced crops, including fruits and vegetables (grains, oats, etc. are also sometimes considered ''produce''). More specifically, the term ''produce'' often implies that the products are wikt:fresh, fr ...
a finished, usable product
or are involved in
Construction is a general term meaning the art and science to form Physical object, objects, systems, or organizations,"Construction" def. 1.a. 1.b. and 1.c. ''Oxford English Dictionary'' Second Edition on CD-ROM (v. 4.0) Oxford University Pre ...
This sector generally takes the output of the
The primary sector of the economy includes any industry
Industry may refer to:
* Industry (economics)
In macroeconomics, an industry is a branch of an economy that produces a closely related set of raw materials, goods, or se ...
A raw material, also known as a feedstock, unprocessed material, or primary commodity, is a basic material that is used to produce goods
Economics () is the social science that studies how people interact with value; in par ...
s) and creates
Finished goods are goods that have completed the manufacturing process but have not yet been sold or distributed to the end user.
Manufacturing has three classes of inventory:
# Raw material
# Work in process
# Finished goods
suitable for sale to domestic
Business is the activity of making one's living or making money by producing or buying and selling products (such as goods and services). Simply put, it is "any activity or enterprise entered into for profit."
Having a business name
A trade ...
A consumer is a person or a group who intends to order, orders, or uses purchased goods, products, or Service (economics), services primarily for personal, social, family, household and similar needs, not directly related to entrepreneurial or bus ...
s and for
An export in international trade
International trade is the exchange of capital, goods, and services across international borders or territories because there is a need or want of goods or services.
In most countries, such trade rep ...
(via distribution through the
The tertiary sector of the economy, generally known as the service sector, is the third of the three economic sectors of the three-sector theory. The others are the secondary sector (approximately the same as manufacturing
Manufacturing is t ...
). Many of these industries consume large quantities of energy, require
A factory, manufacturing plant or a production plant is an industrial site, often a complex consisting of several buildings filled with machinery
A machine is a man-made device that uses power to apply forces and control movement to per ...
and use machinery; they are often classified as
Light or visible light is electromagnetic radiation within the portion of the electromagnetic spectrum that can be visual perception, perceived by the human eye. Visible light is usually defined as having wavelengths in the range of 400–700 ...
Heavy may refer to:
* Heavy (aeronautics), a term used by pilots and air traffic controllers to refer to aircraft capable of 300,000 lbs or more takeoff weight
* Heavy, a characterization of objects with substantial weight
In scien ...
based on such quantities. This also produces
Waste (or wastes) are unwanted or unusable materials. Waste is any substance which is discarded after primary use, or is worthless, defective and of no use. A by-product by contrast is a joint product of relatively minor Value (economics), e ...
Waste heat is heat that is produced by a machine, or other process that uses energy, as a byproduct of doing Work (thermodynamics), work. All such processes give off some waste heat as a fundamental result of the laws of thermodynamics. Waste hea ...
that may cause environmental problems or
Pollution is the introduction of contaminants into the natural environment that cause adverse change. Pollution can take the form of chemical substances or energy, such as noise, heat, or light. Pollutants, the components of pollution, can be ...
Economics () is the social science that studies how people interact with value; in particular, the Production (economics), production, distribution (economics), distribution, and Consumption (economics), consumption of goods ...
). Examples include textile production
, car manufacturing
A handicraft, sometimes more precisely expressed as artisanal handicraft or handmade, is any of a wide variety of types of work where useful and decorative objects are made completely by one’s hand or by using only simple, non-automated relat ...
Manufacturing is an important activity in promoting
Economic growth can be defined as the increase or improvement in the inflation-adjusted market value
Market may refer to:
A market is a composition of system
A system is a group of Interaction, interacting or interrela ...
Development or developing may refer to:
*Development hell, when a project is stuck in development
*Filmmaking#Development, Filmmaking, development phase, including finance and budgeting
*Development (music), the process thematic material i ...
. Nations that export manufactured products tend to generate higher marginal
Gross domestic product (GDP) is a monetary
In a 1786 James Gillray caricature, the plentiful money bags handed to King George III are contrasted with the beggar whose legs and arms were amputated, in the left corner">174x174px
Money is any ...
growth, which supports higher
Income is the consumption and saving opportunity gained by an entity within a specified timeframe, which is generally expressed in monetary terms.Smith's financial dictionary. Smith, Howard Irving. 1908. Income is defined as, "Revenue; the amount o ...
s and therefore marginal
Tax revenue is the income
Income is the consumption and saving opportunity gained by an entity within a specified timeframe, which is generally expressed in monetary terms.Smith's financial dictionary. Smith, Howard Irving. 1908. Income is define ...
needed to fund such government expenditures as
Healthcare is the maintenance or improvement of health
Health is a state of physical, mental and social well-being
Well-being, also known as ''wellness'', ''prudential value'' or ''quality of life'', refers to what is intrinsically valuab ...
Infrastructure is the set of fundamental facilities and systems that support the sustainable functionality of households and firms. Serving a country, city, or other area, including the services and facilities necessary for its economy
An eco ...
A developed country (or industrialized country, high-income country, more economically developed country (MEDC), advanced country) is a sovereign state
A sovereign state is a political entity that is represented by one centralized governmen ...
, it is an important source of well-paying jobs for the
The middle class is a Social class, class of people in the middle of a social hierarchy. Its usage has often been vague whether defined in terms of job, occupation, income, education or social status. The definition by any author is often chosen f ...
(e.g., engineering) to facilitate greater
Social mobility is the movement of individuals, families, households, or other categories of people within or between Social stratification, social strata in a society. It is a change in social status relative to one's current social location ...
for successive generations on the economy. Currently, an estimated 20% of the
The workforce or labour force is the labour economics, labour pooling (resource management), pool either in employment or unemployed.https://www.bls.gov/bls/glossary.htm It is generally used to describe those working for a single types of comp ...
in the United States is involved in the secondary industry.
The secondary sector depends on the primary sector for the raw materials necessary for production. Countries that primarily produce
Agriculture is the science, art and practice of cultivating plants and livestock. Agriculture was the key development in the rise of sedentary human civilization, whereby farming of domesticated
Domestication is a sustained multi-generat ...
and other raw materials (i.e., primary sector) tend to grow slowly and remain either under-developed
Example of Older Classifications by the IMF and the United Nations, UN from 2008
A developing country is a country with a less developed industrial base and a low Human Development Index (HDI) relative to other countries. However, ...
. The value added through the transformation of raw materials into finished goods reliably generates greater
An economic profit is the difference between the revenue a commerce , commercial entity has received from its outputs and the opportunity costs of its inputs. Unlike an accounting profit, an economic profit takes into account both a firm's Impli ...
, which underlies the faster growth of developed economies