Commerce

This article is about the business concept. For other uses, see Commerce (disambiguation).

Commerce is the activity of buying and selling of goods and services, especially on a large scale. The system includes legal, economic, political, social, cultural and technological systems that are in operation in any country or internationally. Thus, commerce is a system or an environment that affects the business prospects of economies. It can also be defined as a component of business which includes all activities, functions and institutions involved in transferring goods from producers to consumers.

History

The caduceus has been used today as the symbol of commerce with which Mercury has traditionally been associated.

Some commentators trace the origins of commerce to the very start of communication in prehistoric times. Apart from traditional self-sufficiency, trading became a principal facility of prehistoric people, who bartered what they had for goods and services from each other. Historian Peter Watson dates the history of long-distance commerce from circa 150,000 years ago.

In historic times, the introduction of currency as a standardized money, facilitated a wider exchange of goods and services. Numismatists have collections of these monetary tokens, which include coins from some Ancient World large-scale societies, although initial usage involved unmarked lumps of precious metal.

The circulation of a standardized currency provides a method of overcoming the major disadvantage to commerce through use of a barter system, the "double coincidence of wants" necessary for barter trades to occur. For example, if a man (or woman) who makes pots for a living needs a new house, he/she may wish to hire someone to build it for him/her. But he/she cannot make an equivalent number of pots to equal this service done for him/her, because even if the builder could build the house, the builder might not want many or any pots. Currency solved this problem by allowing a society as a whole to assign values and thus to collect goods and services effectively and to store them for later use, or to split them among several providers.

During the Middle Ages, commerce developed in Europe by trading luxury goods at trade fairs. Wealth became converted into movable wealth or capital. Banking systems developed where money on account was transferred across national boundaries. Hand to hand markets became a feature of town life, and were regulated by town authorities.

Today commerce includes as a subset a complex system of companies which try to maximize their profits by offering products and services to the market (which consists both of individuals and other companies) at the lowest production cost. A system of international trade has helped to develop the world economy but, in combination with bilateral or multilateral agreements to lower tariffs or to achieve free trade, has sometimes harmed third-world markets for local products, it has been argued. (See Globalization.)

See also

• Accounting
• Advertising
• Bachelor of Commerce
• Business
• Capitalism
• Commercial law
• Distribution (business)
  • Wholesale
  • Retailing
• Cargo
• Eco commerce
• Economy
• Electronic commerce
• Export
• Fair
• Finance
• Fishery
• Harvest
• Industry
• Import
• Laissez-faire
• Manufacturing
• Marketing
• Marketplace
• Mass production
• Master of Commerce
• Merchandising
• Trade