What is Market? Meaning, Types or Classification of Market

What is Market? Meaning

Usually, Market means a place where buyer and seller meets together in order to carry on transactions of goods and services.

But in Economics, it may be a place, perhaps may not be. In Economics, market can exist even without direct contact of buyer and seller. This fact can be explained with the help of the following statement.

Image credits © Uncle Buddha.

"Market refers to an arrangement, whereby buyers and sellers come in contact with each other directly or indirectly, to buy or sell goods."

Thus, above statement indicates that face to face contact of buyer and seller is not necessary for market. E.g. In stock or share market, the buyer and seller can carry on their transactions through internet. So internet, here forms an arrangement and such arrangement also is included in the market.

Classification or Types of Market

The classification or types of market are depicted in the following chart.

Image credits © Prof. Mudit Katyani.

Generally, the market is classified on the basis of:

1. Place,
2. Time and
3. Competition.

On the basis of Place, the market is classified into:

1. Local Market or Regional Market.
2. National Market or Countrywide Market.
3. International Market or Global Market.

On the basis of Time, the market is classified into:

1. Very Short Period Market.
2. Short Period Market.
3. Long Period Market.
4. Very Long Period Market.

On the basis of Competition, the market is classified into:

1. Perfectly Competitive Market Structure.
2. Imperfectly Competitive Market Structure.

Both these market structures widely differ from each other in respect of their features, price, etc. Under imperfect competition, there are different forms of markets like monopoly, duopoly, oligopoly and monopolistic competition.

1. A monopoly has only one or a single (mono) seller.
2. Duopoly has two (duo) sellers.
3. Oligopoly has little or fewer (oligo) number of sellers.
4. Monopolistic competition has many or several numbers of sellers.

The suffix poly has its origin from Greek word Polus which means many or more than one.