A
market is any one of a variety of
systems,
institutions,
procedures,
social relations and
infrastructures whereby parties engage in exchange. While parties may exchange goods and services by
barter, most markets rely on sellers offering their goods or services (including labor) in exchange for
money from buyers. It can be said that a market is the process in which the prices of goods and services are established.
For a market to be competitive, there must be more than a single buyer or seller. It has been suggested that two people may trade, but it takes at least three persons to have a market, so that there is competition on at least one of its two sides
However, competitive markets rely on much larger numbers of both buyers and sellers. A market with single seller and multiple buyers is a
monopoly. A market with a single buyer and multiple sellers is a
monopsony. These are the extremes of
imperfect competition.
Markets vary in form, scale (volume and geographic reach), location, and types of participants, as well as the types of goods and services traded. Examples include:
In
mainstream economics, the concept of a
market is any structure that allows buyers and sellers to exchange any type of goods, services and
information. The exchange of goods or services for
money is a
transaction. Market participants consist of all the buyers and sellers of a
good who influence its
price. This influence is a major study of
economics and has given rise to several theories and
models concerning the basic market forces of
supply and demand. There are two roles in markets,
buyers and
sellers. The market facilitates
trade and enables the distribution and
allocation of resources in a society. Markets allow any tradable item to be evaluated and
priced. A market emerges more or less spontaneously or is constructed deliberately by human interaction in order to enable the exchange of rights (cf.
ownership) of services and goods.
Historically, markets originated in physical
marketplaces which would often develop into — or from — small communities, towns and cities.