Concept of Public and Private

Sectors
Principles of Business – Form 4
Introduction

● In mixed economies businesses are

classified into two types depending on
the OWNERSHIP.

● These are the PUBLIC and PRIVATE

sectors
PRIVATE SECTOR

● This is the part of the economy that is

funded by private individuals and
controlled by private firms.

● The objective of the private sector is to

make a profit.
The private sector includes:

● self-employed persons
● manufacturing industries
● joint venture businesses
● multi-national firms
● firms in the construction industry
● co-operatives.
● In most countries, it also includes the
“hawkers”.

● HAWKERS - those who are engaged in

purchasing items from abroad to be sold
locally on the streets or in homes.
Examples of firms in the Private
Sector
1. One- owner business e.g. small shop
on the street

2. The family owned business

3. The large business with several

investors

4. The multinational companies

Common features of firms in the
private sector
● 1. The aim is to make a profit

● 2. Profits are shared among

shareholders or those who invest in
the company
● 3. The business is funded by the owners

● 4. There is little or no Government

intervention or control

● 5. The business is funded by private

individuals
● 6. Owners are free to make their own
decisions (they must not be contrary to
the laws of the land)
The Public Sector

● This is the part of the economy that is

funded by the GOVERNMENT or its
agents.
● The surplus or profit is used for the
benefit of the entire population.
The Public Sector includes:

● Government controlled companies

● Companies incorporated by the

Government through legislation

● Companies essential for the

development of the economy
Features of firms in the Public
Sector, this sector -
● Aims to provide a service at the lowest
possible price

● Uses profits to improve the efficiency of

the firm or to benefit ALL citizens
● Is funded by the Government through
taxation

● Is driven by the need to provide GOODS

and SERVICES to the population – so as
to improve the quality of life of the
citizens.
● Participates in ventures that provide
basic necessities
THE END
Quiz

● 1. Jim maintains his family by using his

private vehicle for hire

● 2. Mary goes to florida every three months to

shop . On her return she sells goods in the
vendors mall

● 3. State Co. is a company that the government

has 60% ownership
● 4. Agri. Co. an agricultural company that
grants loans to farmers is controlled by
the state.

● 5. Power Supply Inc. is a joint venture

firm which supplies energy to the country
● 6. The postal agency, which is a
statutory body that is controlled by an
appointed Government board of directors

● 7. The public transport company that is

funded by taxpayers
● 8. A group of designers and
seamstresses formed themselves into a
company, Jamaica garments, which
supplies uniforms and a variety of cloths
for the Government

● 9. A multinational firm that has been

serving food and related beverages to
the Caribbean area
● 10. Sampson’s Housing Development
has been building homes throughout the
Caribbean and Latin American countries