How do markets effect the equality of buyers and sellers?
Answers
Three little words. Often that is all it takes to make one’s heart beat faster. “Liberty, equality, fraternity” captured the French Revolution. “I love you” underpins many a successful relationship. “Life, liberty, happiness” are at the heart of the U.S. Declaration of Independence. For many economists, those three magic words are “supply, demand, price.”
In any market transaction between a seller and a buyer, the price of the good or service is determined by supply and demand in a market. Supply and demand are in turn determined by technology and the conditions under which people operate. At one extreme, the market could be populated by a large number of virtually identical sellers and buyers (for example, the market for ballpoint pens). At the other extreme, there might be only one seller and one buyer (as would be the case if I want to barter my table for your quilt).