The private sector is the set of economic activity that is not controlled by the state. While in the public sector the leading role is in the hands of the state, in the private sector the company is the fundamental element.
When we say that private companies are the engine of this sector, we must bear in mind that it does not matter what its volume is or what legal form it has. A company can be formed by an individual independently or by thousands of workers and legally it has different organizational options (limited partnership, joint-stock company, partnership, a temporary union of companies or UTE ...). In any case, the main objective of the private sector is the economic benefit through the products or services that it tries to commercialize within a market in which it competes with other companies.
With the goal of making money
The economic benefit is the fundamental aspect of the private sector, but not the only one. It must be borne in mind that the different companies create employment in the different economic sectors and employment has an obvious social and not exclusively economic dimension.
Another relevant issue in the private sector is its social responsibility. In recent years, some companies have incorporated criteria that are not exclusively economic to guide their activity. You could say that ethics and certain values can be part of the entrepreneurial spirit. This reality receives a name, Corporate Social Responsibility (CSR). The fundamental characteristic of these companies is that their social dimension (for example, their commitment to the environment) is voluntary.
Private sector or public sector debate
There is a classic debate in economics regarding the importance of the two sectors. From some political positions, the role of the private or public sphere is defended. For some, the public sector must be maintained and strengthened, since it is a guarantee of equality, of social justice and allows social imbalances to not run so deep. For others, the public sector is ineffective, very expensive and interventionist, so they understand that the private sector must be used as the true engine of the economy and limit the public to its minimum expression.
From an ideological perspective, the supporters of the private sector would be the liberal or neoliberal political formations and the defenders of the public would be the social democratic ideologies.
In practice, the two sectors are related in the economic sphere, since some public services are managed by private entities through concessions or subcontracting of services.
