The market as an economic category is closely related to the exchange, circulation, trade and other categories.
Exchange can be viewed from two sides:
- As a process of movement of goods and services, as a process of social metabolism;
- The process of creating certain social relations entered into by individuals in this metabolism.
Commodity circulation - a more advanced form of commodity exchange. This commodity exchange, carried out by means of money (C - M - C), at mutual retribution and equivalence, mutual agreement of participants in the process.
Market - a particular form of manifestation of commodity exchange and circulation. Hence the market as an economic category is a set of specific economic relations and communications between buyers and sellers, as well as resellers on the movement of goods and money, which reflects the economic interests of market entities and to exchange the products of labor.
In the market as an independent subsystem presents all the economic relations of the system: the relations of production, distribution, exchange and consumption, property relations, the implementation of the economic interests and the organization of marketing activities; relationship of planning and natural free market forces.
In the market as an independent subsystem presents all the economic relations of the system: the relations of production, distribution, exchange and consumption, property relations, the implementation of the economic interests and the organization of marketing activities; relationship of planning and natural free market forces.
The market is like a dual nature (Fig. 2.).
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Fig.2. The essence of the market
The essence of the market is reflected in its main economic function. The economic function - the main purpose of which is called upon to fulfill this category.
Function of the market:
1. Harmonization of production and consumption in the assortment structure, maintaining a balance of supply and demand in terms of volume and texture. This function performs market regulation proportions by bringing together hundreds of thousands of independent producers and consumers through the buying and selling of goods and services;
2. Becoming a value equivalent to the exchange of products. Market matches the individual costs of labor to produce a model with the public, that is, commensurate costs and results, identify the value of the goods by determining not only the quantity of labor expended, but for what use;
3. Economic incentives for efficiency, encouraging manufacturers to create the necessary products at the lowest cost and maximum profit;
4. Promote scientific and technological progress and, based on the intensification of production and efficiency of the whole economy;
5. Providing dynamic proportionality in the development of certain regions, provinces, territories and national economies in response to the deepening of the social division of labor and the trend towards internationalization and growth of the integration processes in the economy.
6. The economics of consumption reduce distribution costs in the consumption demand of the population and proportion to wages.
Market's role in social production is as follows:
1. Provide a signal production, which, in what amount and structure should be made (this is reversed, the "primary" communication as to produce something that can be implemented);
2. Balance the supply and demand to balance the economy;
3. Differentiate manufacturers in accordance with the efficiency of their work and aiming to cover the market demand;
4. "Health care" is reduced to the role of the market is not competitive enterprises Shootout and curtailment of obsolete facilities.
The market mechanism - a mechanism relationship and interaction of the basic elements of the market: supply, demand and prices. Feature of the market mechanism is that each element is closely linked to the price, which is the main tool for influencing the supply and demand. In particular, demand is inversely related to the price: with an increase in price of the commodity demand is usually reduced and vice versa.
Market conditions - a set of folding on the market at any given point in time the economic conditions under which the process of the sale of goods and services. Market conditions determined by the economic indicators of the state of the market: by supply and demand, prices, market capacity, solvency capacity of consumers, the state of the inventory of the market, etc.
Types of markets. Characteristics of the market as a set or arena acts of sale can be expanded in terms of its structure, systems, markets and infrastructure. Market structure - internal structure, location, order of the individual elements of the market. Signs of any structure are: a close relationship between its elements, the definition of the stability of these relationships; integrity, collection of data elements.
The following types of markets:
1. Consumer market in the country until recently was organized by state and cooperative enterprises of trade, public catering, collective and individual markets underdeveloped forms as private. It includes food markets, transportation, the services market of culture, education and health care.
2. The housing market in this country until recently existed in the form of purchase and sale of private homes, villas and other possessions of this kind, as well as co-operative apartments, which can be sold or bought. In connection with the privatization of public sector housing, we can expect the formation of a full, rather than a limited narrow area of shadow exchange or sale "by agreement" of the housing market, covering all kinds of living space.
3. The labor market, in principle, has always existed. However, in our economy workforce was not the object of free sale in connection with its planned distribution, extra-economic coercion and state wage rates, the lack of a free system of hiring and layoffs.
4. The investment market is one of the varieties of the money market, which are subject to market relations investment.
5. The securities market is closely linked to the capital market, because it represents an actual title of the property in the capital - stocks, bonds, notes and other liabilities.
6. Money market and the currency is almost officially in our economy is absent or worn shady character. In a very limited form of currency market covers only the sphere of foreign economic relations. The normal functioning of this market requires the creation of stock and currency exchanges, which will be sold, and sold currency for rubles at the global, national, free and auction rate.
7. Market innovation, i.e. innovations, inventions, innovations, almost as absent in our economy. The transition to a market economy allows us to consider innovation product that is advisable to sell at the market price that is sure to lead to the acceleration of scientific and technological progress.
8. Market information product - a special market, traded here are books, newspapers, pictures, different kind of advertising and any other set of objects and activities that carry people to the relevant information.
9. License market share of the market innovation. Traded here are off-patent and patent license to transfer inventions, technological expertise, etc. is trading technology. Under present conditions the most common international practice have license agreements that integrate technological exchange with the provision of know-how and engineering services for the industrial implementation of selling technology.
10. Buyers in the market offer must exceed the demand, and then the buyer compares the different varieties of each product, the price, and has a preference for a particular product. Here we have a competition of manufacturers and dealers, which is typical of modern developed national and international markets.
11. Seller's market is characterized by significant excess of demand over supply. It plays the main role of goods and services, quality is given minimal attention.
12. Market resellers express a set of economic relations of individuals and organizations who buy goods for resale or letting them out so consumers for profit.
13. Global market - not just a set of national markets of different countries, economic relations between which are defined in international trade, but also the emergence of a new quality.
Modern market infrastructure includes information systems, marketing, credit and insurance.
Market infrastructure - a collection of legal forms that mediate the movement of goods and services, the deed of sale, or a set of institutions, systems, services, businesses serving the market and perform specific functions to ensure its normal functioning.
The main elements of the infrastructure of the market are:
1. Exchange (trade, commodity, stock, currency), their institutionalized mediation
2. Auctions, fairs, and other forms of organizing is not a stock brokerage;
3. Credit System and commercial banks;
4. Tax system and the tax inspectorate;
5. Customs system, etc.
