Chapter 27 – The Private Sector & the Public Good

What do we mean by the private sector?

The private sector is the part of the economy that is owned and operated by individuals or groups rather than by government. It includes a wide range of organizations that produce goods and services for people to buy and use.

When we talk about companies and businesses, we are usually referring to the same thing. A company or business is an organization that sells products or services, hires workers, and seeks to earn a profit. Businesses can be large corporations that operate around the world, mid-sized firms that serve regional markets, or small shops owned by families in a single neighborhood.

The private sector is different from the public sector, which includes government agencies funded by tax dollars, and the nonprofit sector, which includes organizations that use donations or grants to serve communities rather than earn profits.