Formal And Informal Economies (Topic 3) Flashcards
Define formal economy
Official economy and meets legal standards for accounts, taxes and workers’ pay and conditions
Define informal economy
Unofficial and unregulated economy where no records are kept. People in the informal economy have no contracts or employment rights.
What is the primary economic sector?
The collection of raw materials from their natural sources.
Give examples of jobs in the primary sector
Jobs include fishing, farming, mining
What is the secondary economic sector?
Turning one product into another, like manufacturing.
What is the tertiary economic sector?
Involves providing a service to the public
Give examples of jobs in the tertiary sector
Emergency services, retail and transport
What is the quaternary economic sector?
In the information economy, including research and development, where scientists investigate new products.
Why do few people in developed countries work in the informal economy?
Because most people are highly skilled and educated and work in the formal tertiary and quaternary sectors.
Where (in what sector) do most people in developing countries work?
In the low skilled, informal tertiary sector. A very common example of this is a street market stall.
In the pre-industrial stage, what sector was the most common?
The most common sector was the primary economy, but over time this has decreased dramatically.
Which economic sector started growing in the post-industrial stage?
The quaternary sector started growing, as industrialisation increased and technology advanced.
In which sectors are the best working conditions to be found?
In the tertiary and quaternary sectors, as these are more likely to be office jobs or safe environments.
Why are informal economies a problem for the government?
The government does not receive taxes from informal businesses.
Give examples of jobs in the secondary sector
Jobs include making textiles, chemicals and furniture.
