Mercado

Mercado is the Spanish term for market, used to describe both a physical place where goods are traded and the broader economic concept of market activity. In everyday language, mercados are places such as open-air or covered venues where vendors sell food, flowers, and other merchandise. In economics, the market is the mechanism by which buyers and sellers interact to determine prices and allocate resources for goods, services, and capital. The word comes from Latin mercatus, meaning trade or market.

Markets take many forms. Physical markets include local or municipal spaces with stalls and producers. Modern retail markets include supermarkets and online platforms. Financial markets encompass markets for stocks, bonds, currencies, and other financial instruments; the term mercado de valores is commonly used for the stock market, and mercado de divisas for the foreign exchange market. The labor market describes the allocation of labor through wages and employment opportunities. There are also real estate markets and commodity markets.

Key characteristics of markets include price formation through supply and demand, competition among sellers, and information flow among participants. Prices serve as signals that help allocate resources efficiently. Markets operate within institutional frameworks—property rights, contract law, and regulatory oversight—that influence their efficiency and stability. While markets are often associated with liberal economies, many economies combine market mechanisms with public policy tools to address equity, externalities, and public goods.