Market and market mechanism

The market is one of the fundamental economic categories and the main concept of economic practice. With the development of commodity production, the market was constantly changing, its new forms appeared, and the market mechanism was improving. Although the concept of the market seems to many quite unambiguous, in Russia and in the West they put fundamentally different meanings in it.

Initially, the concept of "market" had a direct practical meaning. This word denoted any space, for example, a city square or a bazaar where the sale and purchase of various goods took place. Over time, the social division of labor deepened, and commodity production became more and more developed, so the term "market" acquired a broader economic interpretation.

By it they no longer understand a strictly limited territory for the sale of goods. For the first time, the French economist designated the term “market” as a certain area where there are uniform economic factors, so the prices of goods quickly enough equalize only under the influence of supply and demand.

Modern interpretation

Today, the market is considered to be a type of economic relations between economic entities. Economic relations can be natural-material, or free of charge, and commodity, carried out through the market. If we take into account reproductive exchange, then the market can be considered as a form of competitive connection between consumption and production. In particular, P. Samuelson defines the market as a "competitive bidding process."

Russian economist L. Abalkin believes that the market should be called the exchange organized according to the laws of commodity production, as well as the totality of commodity and monetary relations. Based on this definition, to understand the essence of the market, it is necessary to clarify a number of significant issues, namely:

- How exactly do the laws of commodity production and circulation;

- as you should understand the totality of commodity and monetary relations.