This document discusses market structure and its various forms. It defines a market and lists its key features such as buyers and sellers, competition, interaction, existence of commodities, price, and knowledge. The document then classifies markets based on area, nature of transactions, volume of business, time period, level of regulation, and sellers. It also discusses different forms of market structure from perfect competition to monopoly based on the number of firms and level of product differentiation. Concentration and its effect on competition are explained. Finally, some Hindi translations of market structure terms are provided.
1. MARKET STRUCTURE
By
Dr. Raksha Singh
Principal
Shri Shankaracharya
Mahavidyalaya
rakshasingh20@hotmail.com
www.ssmv.ac.in
Dr. RAKSHA SINGH
2. MARKET
According to Sidgwick,”
A market is a body of persons in such
commercial relations that each can easily
acquaint himself with the rates at which certain
kinds of exchange of goods or services are from
time to time made by the others.”
Dr. RAKSHA SINGH
3. FEATURES OF MARKET
1. Buyers & Sellers
A product will be produced and marketed only when there is demand for it .
Without seller demand for any product is worthless
2. Competition
Some competition among buyers and sellers are important
3. Interaction
Proper interaction is compulsory for to know the terms and conditions of
exchange of the commodity
4. Existence of Commodity
There are separate market for separate commodities, Willingness to buy and
sell is possible with existence of a commodity
5. Price
Mutual agreement for price
6. Knowledege
Dr. RAKSHA SINGH
4. MARKET CLASSIFICATION
Market can be classified
1.Area-
Local - confined to particular locality- vegetable mundi
Regional extends to a larger area say district or state( for durable goods)
National
International
2.Nature of transactions-
Spot Market- If transactions are confined to a particular spot
Future Market- If goods are to be exchanged at future
3.Volume of business
Wholesale market- If goods exchanged in large quantities
Retail market- If goods exchanged in small quantities
Dr. RAKSHA SINGH
5. MARKET CLASSIFICATION…..
4. Basis of time
Prof Alfred Marshall, on the basis of time divided market in four
Very Short period - Supply inelastic, cannot adjust itself with the
changes in demand
Short period- Small changes in supply are possible through
better utilization of resources
Long period- Sufficient time to adjust supply ,Firm can
adjust size of firm as well as expand or
contract scale of production
Very long period- Supply can be fully adjusted to the changes in
demand through the introduction of new
techniques, innovation
Dr. RAKSHA SINGH
6. MARKET CLASSIFICATION…..
5.Basis of Regulation
Regulated Market- Controlled by appropriate government authorities, to
ensure no unfair practices in the market e.g Stock market
Unregulated Market- Absolutely free market, market forces decides
everything
6.Status of sellers
Primary Market- Manufacturing units or producers sell their goods to the
wholesalers
Secondary Market- Consists of the middlemen E.g wholesalers, who act as a
link between the producers and the retailers
Terminal Market- Consist of retailers who directly supply goods to the
ultimate buyers
Dr. RAKSHA SINGH
7. MARKET STUCTURE
Market structure refers to the number of firms operating in
the industry, nature of competition between them and the
nature of the product.
It consists of both goods market and services (factor)
market.
Determinants of Market Structure
1. The degree to which the industry is vertically integrated
2. The number of firms
3. Nature of Product
4. Conditions of entry and exit
5. Economies of Scale
Dr. RAKSHA SINGH
8. FORMS OF MARKET STRUCTURE
Perfect Competition
Monopolistic
Competition
Oligopoly
Monopoly
MARKET STRUCTURE Morecompetition
Dr. RAKSHA SINGH
As arrow goes up
competition
increases and
concentration is low
as arrow goes down
competition
decreases but
concentration
increase
9. CONCENTRATION
Low Concentration
Concentration defined as -
degree at which a small
number of firms make up for
the total production in the
market (industry)
Firms are not influencing the
market production and the
industry
Less market share Perfect
Competition
High Competition
High Concentration
If this ratio is 100
percent it means
industry is a monopoly
Concentration ratio
ranges from o% to
100% this indicates
competition in the
industry
High market Share
Less Competition
Dr. RAKSHA SINGH
10. FORMS OF MARKET STUCTURE..
Perfect
Competition
Large Number of
buyers and sellers
Homogeneous
Product
Industry
determines the
Price
One price
Monopolistic
Competition
Differentiated
Products
Many Sellers
Dr. RAKSHA SINGH
11. FORMS OF MARKET STUCTURE..
Oligopoly
Few Sellers
Selling
Homogeneous
Pure Oligopoly
Cement, Copper
Selling
Differentiated
Product Imperfect
Oligopoly
Monopoly
Single Seller
No close
Substitutes
Dr. RAKSHA SINGH
12. QUESTIONS
1.Market where
trading of goods
happens in large
quantities
A Retail market
B Regulated Market
C Wholesale Market
D Spot Market
Which industry is
most likely
monopolistic in
nature
A Automobile Industry
B Car Repair
C Electrical Generating
D Steel
Dr. RAKSHA SINGH
They can do business over a phone , telegram, email ordinary post or whatsapp,On line shopping
Market refers to a place or an area where buyers and sellers generally gather in order to buy and sell a particular commodity. Market need not to be located in a particular building, place, or an area but potential buyers and sellers must be contact with each other to conduct exchange transactions
In general sense market where buyer and seller come together but in economics we do not refer market as physical place but they must come in contact directly or indirectly, flipkart, amazon virtual market
Market for one commodity or sets of commodities.
Clothes, Grocery, Jewellery separate market or shops are different where buyers and sellers interact
They can do business over a phone , telegram, email ordinary post or whatsapp,On line shopping
Market refers to a place or an area where buyers and sellers generally gather in order to buy and sell a particular commodity. Market need not to be located in a particular building, place, or an area but potential buyers and sellers must be contact with each other to conduct exchange transactions
They can do business over a phone , telegram, email ordinary post or whatsapp,On line shopping
Market refers to a place or an area where buyers and sellers generally gather in order to buy and sell a particular commodity. Market need not to be located in a particular building, place, or an area but potential buyers and sellers must be contact with each other to conduct exchange transactions
They can do business over a phone , telegram, email ordinary post or whatsapp,On line shopping
Market refers to a place or an area where buyers and sellers generally gather in order to buy and sell a particular commodity. Market need not to be located in a particular building, place, or an area but potential buyers and sellers must be contact with each other to conduct exchange transactions
High concentration and low competition towards monopoly, More competition and less concentration towards perfect competition
Pure /Homogeneous Oligopoly when sells homogeneous product steel, zinc
Imperfect Oligopoly sells differentiated products automobiles,Soaps ,Detergents