Economic market classification

1603
Anthony Golden

The market classification it varies according to the point of view considered. They can be defined as international, national, local markets, producer or reseller markets, markets with perfect or imperfect competition, product or service markets, etc..

In fact, there is no absolute definition of the market. There are multiple approaches or perspectives that propose different ways of interpreting or understanding this term. According to economic theory, a market is the physical place where the interactions between supply and demand occur.

Street market in Hong Kong

In legal terms, the market refers to the transfer of property from one person, natural or legal, to another over a good or service.

On the other hand, in the marketing or marketing, the market is defined as “a group of organized people, with needs to satisfy, money to spend and the willingness to do so.

Other definitions focus on the relationship between those who offer the good or service and those who demand them, while there are authors who are based on the transactions carried out by producers, intermediaries and consumers to result in the setting of a price for the good. or service.

In general, it can be said that in each of the different meanings of the term, the following elements are present: merchandise (goods or services), supply, demand and prices.

How are markets classified?

The types of markets are classified according to various factors, as explained below:

- According to your geographical location

World or international market

It refers to all types of markets located abroad, including all the elements that compose them. For example, the world market for a Chinese mobile phone manufacturer would be the population of Europe, America and the rest of Asia..

National market

It is the one that includes potential buyers, transactions and other factors that are within the country. It is also called the Internal Market.

Regional market

In this type of market those belonging to a defined geographical or economic zone are grouped. Examples of regional markets are the European Common Market and the Southern Common Market (Mercosur).

Local market

A local market is one that is limited to a fairly restricted area. For example, a store in a shopping center, located in a city.

- According to your customers

Consumer market

This type of market is defined according to the product that buyers or users are willing to buy. For example, the "sportswear market" is made up of all the people who demand or need to buy sportswear. In this sense, the same person can belong to several consumer markets, because they have different needs to cover..

Industrial or producer market

The industrial market is essentially a consumer market, only at the corporate level. This means that they use the products they buy to make goods or services. For example, the industrial market for the owner of a corn plantation is the set of companies that make corn flour.

Reseller Market

It refers to companies that buy products or services and then sell them for a profit. Food wholesalers and retailers, for example, are part of the reseller market of food producers.

Government market

This type of market is made up of those government institutions that purchase products or services to later use them in the production of public goods or services. As an example, we can consider that the government market of a manufacturer of electrical cables is the state electrical company.

- According to the competition

Perfect competition market

It is that market in which all the goods and / or services offered are equal, that is to say, homogeneous. That is why consumers do not distinguish between products from one or more manufacturers according to their physical characteristics and it is possible to substitute one brand with another without much difficulty. The price of the product is usually unique given the high number of buyers. Example: the sports drink market.

Monopoly

This type of market is characterized by the existence of a single producer of the good or service for a large number of buyers. An example of a monopoly is Google, Facebook or Amazon.

Imperfect competition market

This category is divided into three subcategories of markets in which the presence of more than one seller is observed:

  • Duopoly: it is a market in which there are only two products that dominate the market. A clear example is the case of Pepsi and Coca-Cola.
  • Oligopoly: in this case the number of sellers / suppliers is small and one of them usually predominates. There is a high demand and a strong dependence of consumers towards producers. Examples of oligopoly include the mobile phone market and cable TV..
  • Monopolistic competition: In this subcategory of markets, the products are substitutable between one manufacturer and another, as happens in the perfectly competitive market, with the difference that they are well differentiated products..

- According to what they offer

Goods market

It is that market where a physical, tangible product is offered.

Service market

It is the markup that offers a service to consumers. For example: internet service, cleaning, legal advice, among others.

- Based on the time it takes to set prices

Instant offer market

The price is established quickly and a reserve price is taken as a reference (the last possible sale price).

Short term market

In this type of market, the pricing of the product is not fast and is highly dependent on production costs.

Long term market

Price calculation is very slow and also depends on production costs.

- Other types of market

-Black market: is the one where illegal products are marketed.

-Work market: it's about supply and demand for jobs.

-Informal market: the market made up of street trade.

-Foreign exchange market: is that market made up of buyers and sellers of foreign currency, such as the purchase and sale of Euros in the United States, for example.

-Virtual markets: are those in which all transactions are carried out through the internet, such as eBay, Amazon, etc..

-Auction markets: In these types of markets, buyers compete by bidding for a product or service, which is ultimately sold to the highest bidder..

References

  1. The market, market classes, perfect and imperfect competition. Recovered from: novellaqalive2.mhhe.com
  2. Tun, T. (1967). Theory of Markets. Cambridge, Harvard University Press.
  3. What is a Market - Definition and Different types of Markets. Recovered from: managementstudyguide.com
  4. Medina, R. (1990). Principles of Marketing. Manila, Rex Book Store
  5. Thompson, I. (2006). My online material UNID: Market Types. Recovered from: moodle2.unid.edu.mx
  6. Díaz, J. (1999). Macroeconomics: first concepts. Barcelona, ​​Antoni Bosch Editor
  7. Esteban, A., et al. (2008). Marketing Principles. Madrid, ESIC Editorial.

Yet No Comments