The New Palgrave Dictionary of Economics

2018 Edition
| Editors: Macmillan Publishers Ltd


  • Pascal Petit
Reference work entry


In everyday language, we make a clear distinction between goods and services. When we refer to services, we tend to think of services rendered to people (classic examples are Fourastie’s much cherished hairdresser, Baumol’s singer and Pigou’s valet). A more recent use of ‘services’, namely business services, refers to the process of externalizing parts of R&D or management functions. Services are commonly seen as extending to activities like retailing, banking, insurance and non-market activities linked to public and private administration. It is, moreover, current practice to include transport and telecommunications within this already vast set of activities. If we consider this heterogeneous whole covering all services, we note that the building industry is excluded (an exception can be found in Clark 1940).

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© Macmillan Publishers Ltd. 2018

Authors and Affiliations

  • Pascal Petit
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  1. 1.