Markets are social institutions that are formed to facilitate the exchange of goods and services. They can be physical or virtual and can be local or international. Regardless of the type of market, most are used for buying and selling goods.
Some markets are physical and operate in a traditional way, while others are virtual and involve the use of information technology. Both of these types of markets can be classified by their level of organization and competitiveness.
For example, a market in which sellers have monopoly power can distort the market price, whereas in a perfect competition market, there is plenty of competition and wide availability of resources. The price fluctuations in the market are minimal.
Critics of markets argue that they are not unbiased and that they can distort values and attitudes. They also call for the overthrow of capitalism. In addition, they have raised questions about the relationship between individuals and markets.
Political philosophers take these criticisms seriously. However, they also argue that markets can only be justified in the context of other institutions.
Economists, in contrast, generally see markets in a positive light. They believe that the market is a source of capital for entrepreneurs and inventors. It also provides a mechanism for the efficient distribution of resources within a society.
As a result, the defense of markets can be found in many theories of the “high liberal” tradition. These include John Rawls, who argues that markets are instrumental in achieving certain aims within the framework of the state.