-Paradox of shopping here is surrounding oneself with superior communication links. -Exploit information imbalances in the end. -2 main. The Bazaar Economy: Information and Search in Peasant Marketing. Clifford Geertz. American Economic Review, , vol. 68, issue 2, Geertz, Clifford, “The Bazaar Economy: Information and Search in Peasant Marketing,” American Economic Review, American Economic Association, vol.

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The last,with its glass-frontedstores,side walk cafes,and motion picture houses strungout along the main street FANSELOW stores’;streetsidestallssellinglotteryticketsare ‘luckycentres’,a chemist’sshop a ‘medicalhall’; and textileshopscanbe ‘cutpiece centres’, ‘readymade’,’silkemporium’, ‘handloomhouse’,or ‘shirting and suitinghall’.

The presentanalysisof the bazaar economy,however,indicatesthe naivetyof the assumptionthatcommoditiessuch as wheat, potatoes or cotton representnaturally homogeneous raw materials.

I did not anticipate that the two would have much relevance for one another, but they do. Pricedispersion There is a fundamentaldifferencebetween the structureof marketsin unbranded, ungradedand loosely sold commodities,and those in branded,standardisedand pre- packaged commodities. Examples oftheformer arepackaged,quality-controlled, andbrandedfruits andvegetablessold insupermarkets2, andexamplesofthelatter arecounterfeit andsecond-hand products.

Thereis therefore an institutional separationbetweenwholesaleand retailbusinessesand markets, whichdoesnotexistin thebazaar,wheremostbusinesses sellto eachother as well as to consumers.

Qualityandquantity of goodsaregivenandthesellerhasonlytheoptionofaltering theprice. We use information technology and tools to increase productivity and facilitate new forms of scholarship. But he considersthisrelationshipbetween traderand non-traderas atypicalofthebazaar,where the commonestrelationship is thatbetween traders middlemen.

Thisfeature ofbazaarbusiness organisationis bestillustratedbytheexampleofone ofthemostspectacular business inKalakkadu. The features associated typically withthebazaarbyitsethnographers areonly foundin thelattertypeof market. Pricing is much more a matter of estimates in a situation where highly specific comparative and historical data are simply not available; instead of exactly calculated prices, one finds the setting of broad limits within which buyer and seller explore together the finer details of the matter through a system of offer and counteroffer.

Even more important, however, the sliding price system tends to create a situation in which the primary competitive stress is not between seller and seller, as it is for the most part in a firm economy, but between buyer and seller. But thereis a buyer and a seller in every transactionin thebazaar,andbyvirtueofoccupyingtheseroles,theformerisstructurally positionedto operateunderconditionsof greateruncertainty thanthelatter.

The twotypesofcommodities differ in termsoftheirtransactional propertiesand therefore in thekindsof functionsperformed by businesses tradingin them. But theyremainso onlyas long as theyare ‘brand’new.


The Bazaar Economy: Information and Search in Peasant Marketing

Since theriskofdefault is considerablyreduced,such loans are substantially cheaperthanthosefrominformal sourcesin thebazaarand theircheaperpricecompensatesforthegreateraccountability which is necessaryto receive them.

The introduction of brandnamestherefore fundamentally altersthe natureof competition inthemarket. This allows to link your profile to this item.

Of course, many buyersstillfinancesuch expendituresthroughloans, but these are obtainednot in the formof creditfromsellers,but frommoneylendersand chitfunds in the bazaar at high ratesof interest.

These shops oftencarrysignswhich declarethattheirstock of goods is ‘hypothecated’to a certainbank; theirdebtsare thuspublic knowledge and it would be difficult forthem to obtainmore thanone loan on thebasisofthesame security.

Sincepricedispersion betweensellersandqualityvariation betweenbrandsappear tobe clearly identifiable, buyers do notgenerally consider themasforms ofdeception, as theydo in thecase of non-standardised goods.

In thebazaarthescopeforbusiness expansion isseverely limited bytheuncertainties ofhavingtosellon creditandhaving to relyon potentially fraudulent employees. The pricemechanism can function as an efficientcommunicative system forthe optimalallocationof resources onlyifbothbuyersand sellersare relatively certain aboutthequality andquantity ofcommodities inthemarket, sothattheyarecomparable relativeto price.

Tax ; Katzinmore recentethnographies of thebazaar emphasiseitsdifferences frommoderncapitalistmarketsand concentrate on itsbizarreand sometimesapparentlyirrationalcharacteristics. In contrast tosucha maverick environment inwhichalmosteverything isuncertain, inthestandardised commodity market, brandnamesandtrademarks actasclassificatory devicesby whichtheprovenanceof goodsin themarketbecomesidentifiable and therefore theirqualitymorepredictable.

While older accounts emphasiseits similarities to modern capitalistmarkets,and even see it as a prototype of the competitivemarket e. In Geertz’sdescriptionof the bazaar trader as somebodypassingon somethinginreturnforsomethingelse,thesecrucialdistinctions between seller and buyer,and between the type of good tradedin the bazaar and money,remainunexamined.

Becausehe was unableto supplyhisown customers, theyturnedto othertraders andceasedto repay theirdebtsto him.

Qualityvariation betweenbrandedproducts is attributed to producers’ technicalsophistication,andpricedispersion betweensellers is attributed to differencesin traders’ commercial competence rather thanattempts to cheat.

Man, New Series, Vol. Perfectcompetition,in contrast,can only occur in geeetz which sellers offerhomogeneous,undifferentiated productsso thattheonlyvariabletheycan control, and in termsof which they compete, is price. Buying and selling are regardedas a unitaryactivityto be looked at simultaneouslyfrom the wholly interchangeableperspectivesof the man who is passing goods to his tradingpartnerand the bazaae who is passingmoney, a differenceitselfof no essentialimport Geertz In contrastto the bazaar trader,a sellerof standardised,substitutable goods does not have to travelto higher-ordermarketsto purchasehis supplies,find out prevailingprice levels,negotiatepurchasingpricesand arrangecredit,inspectthe goods he wantsto buy,and supervisetheirmeasurement,packagingand transport; nor does he have to choose between havingto relyon unreliableemployeesto keep his shop open in the meantime,and stayingin the shop himselfwhile delegatingthese tasksto a potentiallyfraudulentemployee.


One reason why some economistsand economic anthropologists see the bazaar as approachingthe model of theperfectly competitivemarketis the apparentabsenceofmonopolisticcompetition. Geertz considersthatthe crucialdifferences between the bazaar business and the firm-type businesslie in formalorganisationalinnovation,thepermanenceof businessorganisation,the reliabilityof relationshipswith producersand distributors, and the expansionof the urbanpublic market Geertz It also describes the problem facing many entrepreneurial Javanese traders as one of organization, not market orientation.

A wide rangeof goodsofdifferent qualityandin different quantitiesor sizesat variousprices,attracts a widerangeofbuyers withdifferentindividual preferences andofdifferent economic means. Parryfor detailed comments on the earlierversions of the article,for whose content, however, none of them can be held liable. Post was not sent – check your email addresses! In markets forperishableproducts, commodities areusuallydisplayed andrelatively easilyinspectable andoftensoldpiecemeal, therebycounteracting quality andquantity uncertainty.

Wholesaling and retailingare institutionally separatedand while relationshipswith wholesalersare enduring,relationshipswhich involve retailtransactionstend to be ephemeralbecause theyare bazsar a cash basis and thereforedevoid of the element of enduringinterdependence,which formsthe basisof creditrelationships in the bazaar.

Frequently spaceis notenoughand theshopspillsoverintothestreet. This typeof organisational environment greatly reducestheoperational scopeof middlemen, brokersandallkindsofintermediary traders who arecharacteristic ofthe bazaar. Since producersseek to differentiate theirproductsfrom of those otherproducersthe standardisation of productionleads to the differentiation ofproducts,and thiscreatesimperfector monopolisticcompetitionbecause it implies thatproducersdo not compete solelyin termsof price,but also in termsof product quality.

Download full text from publisher File URL: Competition takesplacebetween sellersand betweenbuyers,but notbetweensellersand buyers.

The Bazaar Economy: Information and Search in Peasant Marketing

But thisis irrelevant to the operationof theprice system, whichisnotconcerned withthephysical properties ofthegoodsinvolvedbut withtheactors’beliefsaboutthemandtheirdecisionsbasedon these. As faras possible labouris therefore recruited alongkinshiplines,whichcan to someextentserveto overcomesomeofthestructural limitationson business expansion whichareinherent in thebazaareconomy.

Itmovescompetition fromtherelationship betweenbuyer andsellerto therelationship betweensellers, becausebuyersare consistently able to identifytheprovenance andqualityofa goodandtherefore toexercise choicebetween different products.

Businessorganisation The respectiveeconomic propertiesof non-standardisedand of substitutablecom- moditiesentaildifferent typesof organisationalproblemsforthe businessestradingin them.

The government rationshops are thereforethe exceptionthatproves the rule.