THE PRICE OF WHEAT 135 



marketing of commodities previously not bought and sold. 

 Now, if farmers consumed all their wheat on the farm, a 

 market for wheat would not exist. When, however, 

 division of labour springs up within the social unit, and 

 the farmer confines himself to raising the food supplies 

 from the soil, the smith to making the tools used in pro- 

 duction, etc., a primitive stage in marketing is reached. 

 But when wheat growing becomes confined to certain 

 districts, that is, when in the social economy specialisation 

 by product commences ; and further, when the producer 

 is distinct from the miller, the middleman, etc., that is, 

 when specialisation by process arises, then a market is 

 a necessity. 



What, then, is the exact economic significance of the 

 word ' ' market ' ' ? Cournot says, ' ' Economists understand 

 by the term market not any particular market place in 

 which things are bought and sold, but the whole of 

 any region in which buyers and sellers are in such free 

 intercourse with one another that the prices of the 

 same goods tend to equality easily and quickly."* The 

 economic interpretation of the word "market" is that it 

 refers not to any particular place, but to a commodity, 

 or commodities and buyers and sellers of the same, 

 who are in direct competition with one another. The 

 primary elements of a market are: A commodity, its 

 owner and one or more persons who desire to become 

 the owner of that commodity by exchanging for it a 

 quantity of some other goods. It is important to notice 

 that the buyers and sellers must be in direct competition 

 with each other for the commodity. Around one 

 commodity more than one market may exist. Thus we 

 have the retail and wholesale markets for tea, or a great 

 number of markets for cotton, commencing with that 

 for the raw material and ending with the retail market 

 for finished goods. 



*Quoted Marshall's " Principles, " 6th Edition. Page 324. 



