In the ordinary sense, the word 'market 'refers to a physical place where commodities are bought and sold. The market concept in this common usage gives an idea of a single place to which people go to buy something. Thus, we refer to Connaught place or Chandni Chowk in Delhi, vegetable market, or fish market in Kolkata. However, development in transport and communication and the modern banking system has extended the concept of the market well beyond the idea of a single physical place. Thus, in the case of many commodities like wheat or gold, there may be a world market as these goods can be purchased anywhere in the world.
In economics, however, the term market does not necessarily refer to a particular place, but to the Mechanism or arrangements by which buyers and sellers of a commodity can contact each other for having an economic exchange and can strike a deal about the price and the quantity to be bought and sold.
There are two distinguishing features of a market so defined
The market need not be at a particular place. The geographical area of the market may be large or small depending on how scattered the buyers and sellers are. it may be a small market like a local market, or as large as the world market like the market for wheat, computer, airplane, etc
The essential feature of the market is that the buyer and seller should be able to strike a deal about the price and the quantity to be bought and sold, for this buyer and sellers need not have personal contact with each other they need to have a system of communication with each other through correspondence, telephone, etc. to be able to strike a bargain.
Market structure
Market structure refers to the types of market in which the producers or firm operates indicates how the market is organized. Various market forms are broadly classified based on the competitiveness of the market structure. The competitiveness of the market structure refers to how individual firms can influence the market price of the commodity. Lesser is the power an individual firm has in influencing the commodity's price, the more competitive the market structure. One of the extreme forms of market structure is perfect competition, where a firm has absolutely no power to influence the price of the commodity. In such a market, there are so many firms that none of them has any control over the price; each is a price taker. The other extreme form of market is a monopoly, where only one producer of goods enjoys considerable power to influence the commodity's price. In t hemostat extreme case, there isn't a competition, for example, the electricity board of a city that the power of influencing the price of the electricity there in between these two extreme forms of market, there is several market forms where the individual producers have the power to influence the price and other elements of the market, but only to a limited extent.
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