Tertiary and Quaternary Activities

Services: trade, transport and communication, personal and professional services, tourism, and the knowledge-based quaternary and quinary activities, outsourcing and the digital divide.

Key ideas

Tertiary activities are services that rely on skill and knowledge rather than machines: trade, transport, communication and services.
Retail trade sells directly to consumers; wholesale trade deals in bulk through intermediaries; periodic markets meet on fixed days in rural areas.
Low-order services (grocery, laundry) are common; high-order ones (consultants, specialists) are specialised and fewer.
Tourism draws people by climate, landscape, history and art, and culture; medical tourism combines treatment with travel.
Quaternary activities handle information and research; quinary activities are the highest decision making (gold-collar work).
Outsourcing gives work to outside agencies (KPO is the highly skilled kind); moving work overseas is offshoring.
The digital divide is the gap in ICT access between and within countries.

Remember

Time distance	distance ÷ speed
Carriers needed	customers ÷ deliveries per carrier
Workers in a sector	per cent × total workers ÷ 100
Saving by outsourcing	hours × (home rate − outsourced rate)
Collar colours	red: primary; blue: factory; white: office; gold: senior decision making
Isochrone	a line joining places equal in time to reach

Watch out

Calling software development tertiary instead of quaternary.
Mixing up quaternary (knowledge work) and quinary (top decision making).
Confusing an isochrone with an isotherm or isobar.

Worked example

Suppose a firm pays ₹4,700 an hour for data work at home and ₹3,300 an hour by outsourcing it overseas. How much does it save on 2,100 hours, and what is this kind of outsourcing called?

Working: 2,100 × (₹4,700 − ₹3,300)

Answer: ₹2,940,000; offshoring