The quaternary sector of the economy is a way to describe a knowledge-based part of the economy which typically includes services such as information generation and sharing, information technology, consultation, education, research and development, financial planning, and other knowledge-based services. The term has been used to describe media, culture, and government. The term is a further delineation of the three-sector hypothesis of industry in the sense that the quaternary sector refers to a part of the third or tertiary sector along with the quinary economic sector. It has been argued that intellectual services is distinct enough to warrant a separate sector and not be considered merely as a part of the tertiary sector. This sector evolves in well developed countries and requires a highly educated workforce.
In the quaternary sector, companies invest to ensure further expansion. It is seen as a way to generate higher margins or returns on investment. Research will be directed into cutting costs, tapping into markets, producing innovative ideas, new production methods and methods of manufacture, amongst others. To many industries, such as the pharmaceutical industry, the sector is the most valuable because it creates future branded products from which the company will profit.
According to some definitions, the quaternary sector includes other pure services, such as the entertainment industry.
The quaternary sector consists of those industries providing information services, such as computing and ICT (information and communication technologies), consultancy (offering advice to businesses) and R&D (research, particularly in scientific fields).
The quaternary sector is sometimes included with the tertiary sector, as they are both service sectors. Between them, the tertiary and quaternary sectors are the largest part of the UK economy, employing 76% of the workforce.
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“Even the poor student studies and is taught only political economy, while that economy of living which is synonymous with philosophy is not even sincerely professed in our colleges. The consequence is, that while he is reading Adam Smith, Ricardo, and Say, he runs his father in debt irretrievably.”
—Henry David Thoreau (1817–1862)