TYPES OF ECONOMIES
1. Agrarian Economy 🌾
- Definition:
Primary sector (farming, mining) makes 50%+ of total GDP.
- Example:
India at independence.
- India
Now:
- Primary
sector contributes 18% of GDP.
- But 60%
of people still depend on farming/mining for jobs.
- Unique
Case: Low GDP share but high dependency → India is a mix.
2. Industrial Economy 🏭
- Definition:
Secondary sector (factories, construction) makes 50%+ of GDP.
- Examples:
USA, Germany in the past (now shifted to services).
- Key
Point: Higher industrial share = more developed.
- Today:
Most industrialized nations have moved to service economies.
3. Service Economy 💼
- Definition:
Tertiary sector (services like IT, banking) makes 50%+ of GDP.
- Examples:
USA, Europe, Japan.
- India’s
Growth:
- Service
sector drove 65% of GDP growth (2003–2013).
- Industry:
27%, Agriculture: 8%.
- Post-Industrial
Societies: Countries shift from factories to services (e.g.,
healthcare, education).
Stages of Growth 🔄
- Agrarian
→ Industrial:
- People
move from farms to factories.
- Happened
in Europe/USA during the Industrial Revolution.
- Industrial
→ Service:
- Factories
decline; services rise (e.g., tech, finance).
- Called post-industrial
societies.
India’s Unique Case 🇮🇳
- Contradiction:
- Service
sector dominates GDP (like rich countries).
- But
most jobs still in farming (like poor countries).
- Why? Rapid
service growth without enough factory jobs.
History Lesson
- Post-WWII:
Every country wanted factories (to grow fast).
- Shift
Issues: Some countries (like India) skipped steps → uneven growth.
Summary:
- Agrarian =
Farms feed the economy.
- Industrial =
Factories drive wealth.
- Service =
Tech, banks, hospitals rule.
- India’s
Mix: Services earn money, but farms still employ most people.
🌟 Fun Fact:
If most people farm but services make money, you’re in a “service economy with
agrarian roots”! 🌟