The Market as a Social Institution
Short Questions with answers
1. What is a market?
Answer : A market is a place or system where goods and services are exchanged.
2. What is meant by the “invisible hand”?
Answer : It refers to the self-regulating nature of markets as described by Adam Smith.
3. What is the main focus of economics?
Answer : It focuses on understanding how markets operate in capitalist economies.
4. What does sociology study in markets?
Answer : Sociology studies markets as social institutions.
5. Who wrote The Wealth of Nations?
Answer : Adam Smith.
6. What does “socially embedded” mean in markets?
Answer : It means markets are shaped by social and cultural contexts.
7. What is the main purpose of a tribal market?
Answer : To exchange goods and foster social interaction.
8. What is commodification?
Answer : It is the process where non-market items become market commodities.
9. What is globalisation?
Answer : It is the interconnection of markets, culture, and technology worldwide.
10. Who are the Marwaris?
Answer : They are a business community prominent during colonial times.
11. What is a weekly haat?
Answer : It is a periodic market common in rural India.
12. What is a hundi?
Answer: It is a credit note used in traditional trade systems.
13. What role does caste play in trade?
Answer : Caste networks often control specific trades.
14. What is a status symbol?
Answer : It is an item that represents social or economic status.
15. How did colonialism affect markets?
Answer : It disrupted traditional systems and linked India to global markets.
16. What is liberalisation?
Answer : It is the process of reducing government control over the economy.
17. How did capitalism change labor?
Answer : Labor became a commodity for sale.
18. What is an example of a commodified service?
Answer : Bottled water.
19. What is the Pushkar Fair known for?
Answer : It is a camel fair and religious event.
20. What is marketisation?
Answer : It is using markets to solve social or economic problems.
21. What is a traditional business community?
Answer : Groups like Jains or Marwaris engaged in trade for generations.
22. What is the main activity in a cattle market?
Answer : Buying and selling livestock.
23. How does technology aid globalisation?
Answer : It enhances communication and trade globally.
24. What is a regional market?
Answer : A market linking local areas to larger economies.
25. Who are the Banjaras?
Answer : They are a tribal group involved in long-distance trade.
26. What happens in the Pushkar Camel Fair?
Answer : Livestock trade, religious rituals, and tourism.
27. Why is bottled water an example of commodification?
Answer : It turned free water into a sellable product.
28. What is a caste-based banking system?
Answer : Banking systems operated within specific caste networks.
29. What is a consumer market?
Answer : It is where goods are sold directly to buyers.
30. How do advertisements create markets?
Answer : By associating products with desirable lifestyles.
Medium Questions with answers
1. What is the sociological perspective on markets?
Answer : Sociologists study markets as social institutions shaped by culture and social structures. They focus on the relationships between markets, caste, class, and community. This contrasts with economics, which views markets as independent systems.
2. Why are periodic markets important in rural areas?
Answer : Periodic markets bring together people from different villages to trade goods and services. They also serve as social hubs, fostering interaction and relationships. These markets connect local economies with regional and national ones.
3. What changes occurred in tribal markets during colonial rule?
Answer : Colonialism brought roads and traders, linking tribal markets to larger economies. This increased exploitation of tribal communities, who lost resources and land. Tribal labor became commodified, and their economy shifted under external pressures.
4. What are traditional business communities?
Answer : Traditional business communities, such as the Marwaris and Jains, have long histories in trade. They rely on caste and kinship networks to build trust and ensure success. These communities adapted to colonial and modern economic changes.
5. How did colonialism transform India’s economy?
Answer : Colonialism disrupted local industries, turning India into a supplier of raw materials. Traditional systems like handloom production declined due to competition from British goods. However, some groups adapted, using new opportunities to grow wealth.
6. What is commodification? Provide examples.
Answer : Commodification is turning non-market items into commodities for trade. Examples include bottled water, labor, and matchmaking services. It highlights how capitalism transforms various aspects of life into economic transactions.
7. What is the role of the Marwari community in India’s economy?
Answer : The Marwaris expanded during colonial rule, using extensive social networks for trade. They transitioned from small traders to prominent industrialists. Their success illustrates the importance of adapting to economic changes.
8. What does globalisation mean for markets?
Answer : Globalisation integrates local markets into global networks, affecting trade and culture. For instance, India’s IT sector connects to global economies. It creates opportunities but also exposes local economies to global competition.
9. What is liberalisation, and how has it impacted India?
Answer : Liberalisation reduces government control and encourages private enterprise. It has boosted sectors like technology but hurt farmers and small producers. The economy is now more open to foreign investment and trade.
10. How do markets link local and global economies?
Answer : Markets link economies through trade, technology, and cultural exchanges. For example, local agricultural produce can reach global markets. This connection can create both opportunities and vulnerabilities.
11. Why are weekly haats significant in tribal areas?
Answer : Weekly haats allow tribal people to trade goods like forest produce and buy essentials. They also serve social purposes, like meeting kin and arranging marriages. These markets connect remote areas to larger economies.
12. What is the caste-based specialization in trade?
Answer : Caste networks dominate specific trades due to trust within the community. This creates monopolies in areas like textiles, banking, and agriculture. Traditional systems rely on kinship and reputation to ensure smooth transactions.
13. How does the Pushkar Fair blend culture and commerce?
Answer : The Pushkar Fair is both a livestock market and a religious festival. It attracts tourists, creating a blend of economic and cultural exchange. Pilgrims, traders, and tourists interact, enhancing the fair’s significance.
14. What is the significance of consumerism in capitalist societies?
Answer : Consumerism reflects social status through the goods people buy and display. Products are marketed with symbolic meanings to appeal to aspirations. It creates cultural and economic distinctions within society.
15. How does technology facilitate globalisation?
Answer : Technology connects markets through advanced communication and transport. It enables rapid trade, outsourcing, and cultural exchanges worldwide. This makes local markets part of a larger global network.
16. What is the connection between caste and banking in India?
Answer : Traditional banking relied on caste-based trust and kinship networks. Instruments like hundis facilitated long-distance trade within communities. These systems predated modern banking but played similar roles in enabling commerce.
17. How did colonial policies affect Indian agriculture?
Answer : Colonial policies introduced cash-based systems and increased taxes. Support prices and subsidies, later introduced, protected farmers but were reduced under liberalisation. This left many farmers vulnerable to market competition.
18. What role do advertisements play in modern markets?
Answer : Advertisements shape consumer preferences by associating products with lifestyles. They create demand and highlight cultural or economic symbols. This strategy is key to modern marketing and consumerism.
19. Why is commodification controversial?
Answer : Commodification can exploit people by turning essential values into tradeable items. For instance, selling human organs raises ethical concerns. Critics argue that markets should not control every aspect of life.
20. What is the significance of symbolic consumption?
Answer : Goods symbolize cultural and economic status beyond their utility. This form of consumption distinguishes social classes and lifestyles. Advertisers use these symbols to market products effectively.
Long Questions with answers
1. What did Adam Smith say about markets?
Answer : Adam Smith said markets work on their own through people buying and selling things. He called this the “invisible hand,” which keeps the economy in balance without anyone planning it. This idea is about how markets can grow naturally. But he didn’t study how social factors also affect markets.
2. How are markets linked to society?
Answer : Markets are not just about buying and selling but are connected to society. They are shaped by culture, caste, and class, which affect how markets work. Sociologists say markets cannot be separated from the people and communities in them. This is why markets are social institutions, not just economic ones.
3. How did colonialism change India’s trade?
Answer : Colonialism hurt traditional industries like handloom weaving and turned India into a supplier of raw materials. It connected India to global trade but mostly for British benefit. Some communities, like Marwaris, used this to grow their businesses, but many others became poorer. This completely changed India’s economy and its role in the world.
4. What is the role of caste in Indian trade?
Answer : Caste groups often control certain types of trade because people trust their own community. For example, the Nakarattars used their caste system to run banking and long-distance trade. This made some castes strong in specific markets. It shows how business and caste are connected in India.
5. How does globalisation affect local markets?
Answer : Globalisation connects small markets to the world, giving them new opportunities. Local producers can sell goods globally, but they also face tough competition. Cultural items like yoga are now sold worldwide as part of the global economy. While some benefit, others, like small farmers or businesses, may struggle.
6. How does what people buy show their status?
Answer : What people buy shows how rich or important they are in society. Expensive cars, phones, and clothes are used to show someone’s status. Advertisers create ideas that connect these items with success or style. This makes buying things a way to show your place in society.
7. What has liberalisation done to India’s economy?
Answer : Liberalisation made India’s economy more open and competitive. Industries like IT and outsourcing grew, but small farmers and workers in factories faced problems. Public companies became private, which helped them work better but caused job losses. People disagree about whether the benefits are greater than the problems.
8. Why are tribal markets important?
Answer : Tribal markets help people sell goods like forest products and buy things they need. They are also places for social activities like meeting family and friends. These markets connect remote areas to bigger cities and economies. But modern changes sometimes harm these traditional systems.
9. How has education become a market?
Answer : Education, once taught at home or by the community, is now sold like a product. Private schools and coaching centers charge fees for teaching skills. Only those with money can afford better education, making it unfair for poorer people. This shows how even learning has been turned into a business.
10. What are the arguments for and against liberalisation?
Answer : Liberalisation has helped India grow economically by inviting foreign companies and investment. Supporters say it creates jobs and wealth, while critics say it harms small farmers and workers. With fewer subsidies and protections, many struggle to compete in global markets. People argue whether it helps the country or increases inequality.
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