Interaction of the Public and Private Sectors

Sample Term Paper

Words 1,500


The economy can be divided into public and private sectors. In the public sector, all the activity carried out is owned, operated and funded by the government on behalf of the people of the country.  In the case of the United States, the public sector is at Federal state and local level. This sector comprises of three types of organizations which are either,

  • Government organizations funded through taxation–these can be the different departments of the government.
  • The second type of public sector enterprises is which are publicly owned corporations and in case of manufacturing organizations, state-owned enterprises.
  • The third is partial outsourcing is also thought to be a part of public sector model.

On the other hand, the private sector is all that activity that is owned funded and operated by private organizations and individual and the fundamental objective of private enterprise is to maximize profit. Private sector consists of organizations that are sole proprietorships, partnerships or public limited or private limited corporations. The private sector is not part of the state and it aims to increase its wealth and earn maximum revenue most efficiently.

The difference between the two sectors is evident and the main objectives determine the way they are managed and organized.

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