Myanmar’s Market Dynamics: Currency, Pricing, and Factors
During the reign of King Mindon, silver and copper coins were produced for use as the monetary standard for exchange. The Royal Mint of Yadanabon produced silver coins with the peacock emblem, dated 1214 BE. The one-kyat peacock silver coins produced by the mint were made to be of the same quality as Indian coins. Silver coins were preferred over copper and lead coins. Silver coins were used in denominations of pe thone, mu thone, nga mu thone, and kyat thone. The introduction of new methods and systems led to the flourishing of domestic trade.
Price Allocation
In markets with high prices for goods and services, producers will expand the quantity they produce and sell as much as possible. Buyers, on the other hand, will reduce their purchases as much as possible at high prices. Thus, the market mechanism determines how much to produce and how much to buy based on price.
Impartiality
Because the price mechanism operates according to monetary affordability, only those who can afford the market price of a commodity will obtain it, while those who cannot afford it will not. Because the market responds precisely to purchasing power, it performs an impartial function.
Product Markets
Product markets are markets where households purchase goods (commodities and services) used to satisfy their needs and desires. In product markets, households exchange money for various goods and services, and businesses sell goods and services to earn money. Households want to buy goods from businesses at the lowest possible price to maximize their satisfaction with a certain amount of income. Businesses want to sell their goods to the highest bidder to maximize profits. In this way, a mutually agreeable situation arises between the seller and the buyer, and an equilibrium price can be established between the high price demanded by the seller and the low price offered by the buyer.
Product markets include:
- Commodity Markets: These include retail and wholesale trade of various consumer goods, including food.
- Service Markets: These include trade in various service industries such as commerce, education, and healthcare.
Factor Markets
Factor markets are markets where businesses purchase the factors of production used to produce products for sale to households. In the economic structure, households are the owners of the factors of production, and they sell them to businesses to earn money. Businesses buy the factors they need to produce goods in this market. Households want to earn as much money as possible for their factors, so they will sell to businesses that offer the highest price. Conversely, businesses want to buy factors from households that will sell at the lowest price. In this way, a mutually agreeable situation arises in the markets, and an equilibrium price can be established.
Factor markets include:
- Labor Markets
- Capital Markets
- Money Markets