Household Sector
It plays a huge role in the Economic Development of any Country. The following are brief descriptions of some of the performances:
- Work as a producer: In India, there are numerous families that own multiple small production businesses. These families are self-employed or generate a variety of goods and services. They create businesses that are essentially semi-corporate in character.
- Act like a consumer: Households are the end customers of the companies goods and services. They generate demand in the market based on their interests and inclinations. Firms created and provided commodities in response to market demand. As a result, households decide on a country’s production line.
- Pay taxes to Govt: Households are the primary source of tax income for the government. They are the primary taxpaying entity. A household pays direct taxes to the state in the form of income tax, wealth tax, estate duty, gift tax, and so on. Similarly, a household pays the government numerous indirect taxes such as sales tax, customs duty, VAT, and so on. All of these tax monies are collected for the economy’s welfare and growth.
- Work as a professional: Households provide all sorts of professional services, such as doctors, teachers, lawyers, and engineers. Their efforts are critical to the country’s continued economic prosperity. People’s living standards are raised as a result of these professional services.
- Act as a saver: Any money left over after consumption is set aside for savings. As a result, families receive money after providing a variety of services to the economy. After consumption, the remaining amount of their income is stored in banks or financial organizations. These savings are regarded as one of India’s primary sources of capital generation.
4 Major Sectors of an Economy
For the macroeconomic analysis, the four aggregate macroeconomic sectors that form the basic foundation are household, business, government, and foreign—which account for four gross domestic product expenditures. On the macroeconomic stage, these four sectors are the major ‘actors’.
Table of Content
- What is Economic Sector ?
- 1. Household Sector
- 2. Production sector
- 3. Government Sector
- 4. The External Sector