“Market” is any area within which the meeting between supply and demand for goods and services takes place and the exchange of them through the price mechanism, determined precisely by this meeting: operators decide independently and individually their behavior, in particular, the prices and quantities of sales and purchases, such that the overall market performance, in terms of global prices and quantities, is the result of the countless decentralized decisions taken by the actors operating there and their interactions. The term “competition” can have two meanings and both presuppose the notion of market set out: one of them refers to the conduct of companies, the other to a particular structural conformation of the market. The first meaning is that which recalls rivalry, competition and struggle between companies, which implement independent behavior in order to increase their position on the market, to the detriment of rivals. The second, however, consists of the situation characterized by a large number of operators on the market, each of which offers such a small share of the same product or service that it is not able to individually influence the price level following a change in the quantity offered.
For the polysemy of the term “market” see, in particular, M.R. FERRARESE, Law and market, Turin, 1992, p. 17 ss., Which sorts the variety of meanings into four categories: a) market as place; b) market as ideology; c) market as a paradigm of social action; d) market as an institution.
Summarizes the characteristics of the market economy model: a) free market of production factors (raw materials, capital and labor); b) freedom of private economic initiative; c) organization of the private enterprise according to the principle of capital sovereignty; d) free play of competition; e) consumer sovereignty.
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