Comparative Intercountry Analysis of Tertiarization as a Structural Component of Post-Industrial Development

Author Name(s): Elena V. Perepelkina, Vyacheslav A. Perepelkin, Dmitry V. Abramov, Victoria I. Vlezkova
Author Email: saanecht@mail.ru

Abstract

The formation of postindustrial society actualizes the knowledge of economic patterns inherent in it, the most important of which is tertiarization. Its content includes both cross-sectoral shifts and qualitative changes in the structure of the tertiary sector. The object of the study is to identify general and specific features in increasing the share of the tertiary sector in the economy for groups of countries with different levels of socio-economic development. The reviewed statistics show that the share of the tertiary sector continues to grow in the world economy, with its highest rates in middle-income countries. The predominant income factor (on the side of demand) influences less than the potential factor (on the side of supply) of decreasing the share of the secondary sector and the factor of human capital. The authors emphasize specific factors for oil-exporting countries and post-socialist countries: the narrow sectoral economic spectrum and the priority development of material production. It has been established that the transformation of positive dynamics of the tertiary sector into a driver of sustainable growth of the entire economy is possible if there is a significant reserve of human capital and technological opportunities for replacing traditional services with impersonal production services with progressive labor productivity. If these resources are insufficient, traditional services dominate in the tertiary industry, whose positive impact on the growth of the tertiary sector and the entire economy is limited. Based on the intensive use of human capital, tertiarization is inherent and beneficial to developed countries. For the rest of the countries, the more positive results from the service expansion in production and consumption are, the greater their scale and demand for the expanded reproduction of human capital by the economy and society.

Keywords Impersonal Services with Progressive Labor Productivity, Post-industrial Society, Services Sector, Tertiarization, Traditional Services, Human Capital.

Introduction

The structural aspect of post-industrial development, expressed in expansion of services in production and consumption, remains an important and promising direction of scientific research. In the course of economic development, at the national and global levels, the old reasons are weakened and new ones arise for a shift of economic activity from primary and secondary sectors to the tertiary one, which requires rethinking the content of this structural transformation. At the same time, the interest of scientists in this field has diminished recently, since a significant contribution to the development of the already existing concept of three-sectoral development of ClarkFisher economy (Clark, 1940, Fischer, 1939, Wolfe, 1955, Fourastie, 1954) seems unlikely. Moreover, in developed countries with a small aggregate share of primary and secondary sectors in the economy, the potential and growth rate of the share of the tertiary sector have decreased. We can also note specific country reasons for the insufficient study of tertiarization. So, in the post-Soviet space, the notion of the secondary activity in the tertiary industry has been preserved, as a result of which the term “tertiarization” (Perepelkin and Perepelkina, 2014), which is found in single publications, is about an increase in the share of the tertiary sector. This terminological difference seems not accidental, the signs of this difference are given in a brief review of the literature on relevant topics.

 

Conclusion

In developed economies, terzirization is associated with a structural shift within the tertiary sector, aimed at increasing the share of impersonal services created by highly skilled and highly productive labor. A prerequisite for this is the active accumulation of human capital due to abundant investments in main sources of this economic resource – educational and scientific activities. In economies with an average or low level of development, the expansion of the tertiary sector first of all depends on the dynamics of the population’s income, and only then on inter-sectoral differences in labor productivity and on strengthening of specialization in service activities. However, with a raw export orientation of the country’s economy, the effect of financial security of households can cease to be decisive if the shortage of human capital does not allow investing in secondary and tertiary sectors. The reason for the relatively small share of the tertiary sector may also be the tradition of underestimating its importance, inherited from the era of the “planned economy”. The structural heterogeneity of national economies undergoing a systemic transformation predetermines diametrically opposite opinions concerning prospects for their change: “And processes of industrialization turned out to be incomplete, and post-industrial structures also did not receive serious development” (Suslov 2011, p. 102). The unilateral “new industrialization”, aimed to correct mistakes of the past, can turn out to be a reversal of the general civilizational development. Tertiaryization is objectively necessary for building a postindustrial society, regardless of the specifics of the country, as it is obvious and expedient to make more active use of the growth potential of the national economy, associated with a smaller share of the tertiary sector in it compared to the world average. The future is for economies benefiting from the results of educational and scientific activities carried out mainly in the tertiary sector, on which the intensity of the key resource accumulation of the postindustrial society – human capital depends. The accumulation of physical capital and the improvement of production programs in secondary and primary sectors are also relevant, since in case of their inconsistency with the created human capital, its application will not be effective. The problem of harmonizing the expanded reproduction of human capital with the needs of the economy in it can become an important part of upcoming structural studies.

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