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Traditional Economy Theory from Trio Industry to Quintet Industry

At present,the generally accepted theory on industrial structure is the “trio industry” theory,namely, the first industry (agriculture), the secondary industry (industry) and the third/tertiary industry(service industry).In 1940,British economist C. Clark began to use the concept of “tertiary industry” widely. From then on,this theory was put into extensive use in the world,and many countries have classified their sectors of national economy in terms of this theory.

Today,we can see:In the developed countries, the structure of the three major industries has undergone some significant change. Generally, the work force in the first industry (agriculture) has dropped, only accounting for 5 ~ 6%,and in the USA it only accounts for less than 2%.The proportion of workers in the productive industry has also greatly dropped: In most developed countries, it has dropped to below 30%, and in America, the proportion of productive workers has dropped from 33% to 17% in the recent 30 years. If we are still tied down by the concept of worker-peasant alliance, America’s base of worker-peasant alliance is only less than 20%. More and more work forces are turning to the flourishing tertiary industry that is on the upgrade all the time. Meanwhile,in the proportion of the GDP, that of agriculture and industry is getting lower and lower, and the service industry has become the major factor for the growth of GDP in many countries.
¼br> The traditional economy theory classified all that do not belong to the first industry and secondary industry into the tertiary industry. It is just like taking the tertiary industry as a big bag, letting everything be put into it. Apart from agriculture and industry, all the other sectors are put into this big bag, so it has become a hodgepodge.

Such a classification was proper in the time when agriculture and industry were in the dominant position of economy and the tertiary industry was still at the embryonic stage;

However,in the present time when agriculture and industry are increasingly shrinking and dropping to very unimportant positions and the tertiary industry is becoming more and more diversified in economic activities and its share in the total output value is tending to be dominant, such a classification seems to be very improper.

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