The development of commodity production has become a prerequisite for the emergence of market relations. So the concept of the market appeared . This object of economic relations began to develop rapidly. It is not only the products that result from labor that are sold. The market includes land, forests and other objects created naturally. Let us consider in more detail the concept of the market.
This is a system of relations having an economic essence, which is formed as a result of production, movement, sale of goods, cash and other types of values. Market relations are completely based on the principles of sale.
Initially, markets arose in places of mass sale of goods. Gradually, cities and large shopping centers formed at these points.
Sellers and buyers are market entities. It can be individuals, enterprises, firms and even states. Some of the entities act as seller and buyer at the same time. This is the established chain of relationships, which is the basis for the sale.
The objects of the market are money and goods. The product may have a different shape. These are products that are the result of labor, as well as factors of production (capital, labor, land, etc.). The role of money is played by all possible financial means. But the most common equivalent is money itself.
Objects of market trade are different. It distinguishes the labor market, capital and goods and services.
The labor market presents a set of job vacancies and applicants for these positions. The modern concept of the market is somewhat different from the original. Today, thanks to technological progress, trading can be carried out virtually using a computer.
The concept of financial market includes the turnover of capital, cash in any form. For a more effective implementation of the economic activity of any state, a developed structure of this category of market relations is necessary. Its most important part is the foreign exchange market. He also sells precious metals and stones.
The concept of the foreign exchange market includes the entire sphere of relations in the market sphere, which is associated with the circulation of foreign currency or any securities in this equivalent. Also included are foreign currency capital investments.
At the international level, all operations with any world currency are carried out.
Markets are divided according to specialization. This is a form of division of labor, which depends on the sphere or branch of production.
The concept of the market arose for several reasons. Firstly, due to a person’s disability. That is, there is a shortage of resources. A person can produce only a certain amount of goods, so there is a need to purchase other types of goods or exchange them for existing products.
Another reason for the need of the market is the economic identity of manufacturers. Everyone decides and chooses what kind of goods to produce, and in what quantities.
The main function that the market performs is to regulate the level of supply and demand, as well as the formation of the price level.
Under his influence, it becomes necessary to introduce new technical developments in order to reduce costs and improve product quality.
The market is a source of information for participants in this process.
In addition, he acts as an intermediary between buyers and sellers who receive the right to choose a partner.
As a result of market selection, only those participants who have more opportunities and prospects survive.
The market avoids problems with a shortage of goods and services.