The Time of Money in Financing and Society
Chapter 5: The Market
5. The market Although the market is the fundamental concept of the modern economy, it has no actual definition. Theories do not explain what it is, but how it works or, rather, how it should work, based on the dubious idea of a perfect market, where price expresses the balance between supply and demand in the most advantageous conditions for all participants (section 1). A market of this kind, which lends itself to the idea of maximal efficiency, is, curiously, governed by randomness – that is, by absolute unpredictability. If the movements of a market were reasoned, then they would be exploited and the market would no longer be balanced. The best working market, reportedly, cannot be observed by anyone and, in fact, cannot even be rational. Much information circulates in the market, information that can be exploited for profit, and that mainly concerns the expectations and prospects of the operators. These expectations and prospects are in no way in equilibrium. They are also never complete, because they are continually reproduced by market operations (section 2). The more information produced, the more imperfect the market becomes. The market works because its task is not to observe the world or the needs and state of production, but to observe observers, what they see, what they expect, and how they observe each other (section 3). The market works as a mirror, from which operators obtain the information they need in order to develop their strategies. Competition ensues because no one has all the...
You are not authenticated to view the full text of this chapter or article.
Elgaronline requires a subscription or purchase to access the full text of books or journals. Please login through your library system or with your personal username and password on the homepage.
Non-subscribers can freely search the site, view abstracts/ extracts and download selected front matter and introductory chapters for personal use.
Your library may not have purchased all subject areas. If you are authenticated and think you should have access to this title, please contact your librarian.