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Market and laws of its functioning.

Economics and its role in society. | Human Behavior | Stages of formation economics as a science | Thomas Mun | Macroeconomics since the Bretton Woods era | I. Property and social-economic system of society | II. Property essence as economic category | General types of production organization | Business, social and economic essence and organization | Reproduction of individual capital |


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  7. MARKET AND COMMAND ECONOMIES

The market is a difficult system of relations between buyers and sellers. It developed during long historical development. The following conditions refer to conditions of emergence of the market:

- the public division of labor which has arisen in an extreme antiquity.

- economic isolation of producers. The commodity exchange surely assumes aspiration of equivalence, and it in turn, evolves from isolation of interests.

 

This isolation historically arises on the basis of a private property, further it started to lean on a collective property, but surely limited by any local focus of interest (cooperatives, associations, joint-stock companies, the state enterprises and so on.)

- independence of a producer, freedom of enterprise.

The market fulfills many functions: intermediary, registration (price-forming), regulating, distributive, etc. During an exchange there is a peculiar account and a public assessment of the realized benefits.

The prices give information which serves as incentive to attraction of more economic methods of production and effective use of limited resources. Thereby the market promotes redistribution of the income in favor of better managing subjects.

The market as the developed system of the relations represents set of the interconnected and cooperating markets.

According to the structure the markets can be subdivided by the following criteria:

1) on economic purpose of objects:

– markets of the benefits of and services

- markets of means of production

- securities markets

- labor markets

- currency markets etc.

2) on width:

- local

- national

- international

3) by types of subjects of the market relations:

- consumer market

- commodity market of industrial function

- market of public institutions

- market of wholesale trade

-профицитный рынок

4) on level of satiation in commodity weight:

- scarce market

- equilibrium market

- surplus market

5) on conformity to the legislation:

- legal markets

- illegal markets

 

6) on degree of a maturity of the market relations:

- the developed markets

- the forming markets.

The main concepts of the market are: demand, supply, price.

The markets form the infrastructure set of institutes which serve and provide movement of the goods and services, the capitals and labor.

 

It is possible to carry to them: network of commercial banks and other financial institutions; commodity and stock exchanges; information commercial centers; wholesale intermediary firms; insurance companies; auditor firms; auctions, fairs; centers of marketing, training of managers, brokers and other services.

Control questions:

1. Property as economic category

2. Forms of ownership.

3. Transformation of forms and property relations.

4. Concept of privatization and stages of carrying out privatization in the Republic of Kazakhstan.

5. Models of economic systems.

6. Types of the organization of production: natural and commodity production.

7. Goods and its properties.

 

Сабақ 6


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