A market in economics may or may not refer to a particular place where buyers and sellers meet.
A market may be defined as an institution where both sellers and buyers meet with each other for the purposes of selling and buying of either goods or services.
In other way, a market for a commodity is a system by which the buyers and the sellers establish contact with one another either directly or indirectly with a view to purchasing and selling the commodity.
The main functions of money are:
(i) To determine price of a commodity.
(ii) To determine the quantity of a commodity to be bought and sold.
These two aspects (price and quantity) are determined by the interactions between the buyers and the sellers of the commodity.
Forms of Market:
Market can be categorized as below:
(a) On the basis of Area:
(i) Local Market;
(ii) Regional Market;
(iii) National Market or Domestic Market;
(iv) International Market or Foreign Market
(b) On the basis of legality:
(i) Legal Market
(ii) Illegal or Black Market
(c) On the basis of sale:
(i) Retail Market
(ii) Wholesale Market
(d) On the basis of factors of production:
(i) Land Market
(ii) Labour Market
(iii) Capital Market
(e) On the basis of competition:
(i) Perfect Competition
(iii) Monopolistic Competition
(iv) Oligopoly, etc.
It means the totality of all markets, i.e., markets for all the goods and services in the economy. Therefore, it determines the prices and quantities bought and sold of goods and services in free controlled economy.