Understanding Markets 7 Social Science Chapter 12 CBSE Notes 2025-26

Markets have always played an important role in people’s daily lives by enabling the buying and selling of goods and services. 

They can be physical spaces like bazaars and haats or digital platforms, making goods from far-off places easily accessible. 

Historically, markets like the Hampi Bazaar of Karnataka were centres of economic and cultural exchange, where a huge variety of products were available, and buyers could interact directly with skilled craftsmen and traders.

Meaning and Types of Markets Markets are places or platforms where buying and selling take place. In India, physical markets include local bazaars, weekly haats, malls, and specialized markets. 

With technology, online markets have become common, allowing people to shop through apps or websites without meeting the seller in person. There are also unique markets such as the share market, which deals in stocks and shares, rather than physical goods.

How Markets Function Markets need at least one buyer and one seller. They agree on a price in order for the exchange to happen. Usually, the price is not fixed immediately—negotiation and bargaining are common, especially in local markets. 

If the seller asks for a high price and buyers refuse to pay, the goods may not sell. If the price is too low, the seller earns no profit. Through repeated negotiation, a price is usually decided that both sides accept.

The price in a market is influenced by the number of buyers and sellers, and by demand and supply. For example, vegetables are sold at lower prices when the market is about to close as sellers want to clear stock. 

Similarly, shops give discounts on winter clothing at the end of the season. These changes reflect how markets respond to buyers’ and sellers’ needs and circumstances.

Varieties of Markets: Physical, Online, Domestic, and International Physical markets require buyers and sellers to meet face-to-face. These include roadside stalls, markets, malls, as well as traditional places like Old Delhi’s Khari Baoli spice market. 

Online markets are different as goods and services can be bought and sold from anywhere using websites or apps. Some products, like tailoring or haircuts, still require a physical presence, but others—like books or clothes—can be easily bought online.

Markets also differ by location: domestic markets operate within one country, while international markets involve buying from or selling goods to other countries (imports and exports). India, for instance, is a leading importer of vegetable oils from Southeast Asia and exports textiles and other products worldwide.

Wholesale, Retail, and the Flow of Goods Goods reach buyers through a series of steps. Manufacturers produce goods using raw materials. 

Wholesalers then buy these goods in large lots from producers and store them in warehouses or cold storages. Distributors may help move goods from wholesalers to retailers, especially over long distances. Retailers sell small quantities directly to customers in shops, malls, or even online.

Retailers and wholesalers are both essential in the supply chain. For example, in the Surat textile market, cotton is processed and finished goods are sent to wholesalers across India and abroad. 

This ensures that products are available to consumers at different places and times. Cold storage facilities help preserve perishable goods like fruits and vegetables until they are sold.

Online markets use aggregators, which are platforms that gather products from different sellers and make them available to buyers on a single website or app. Large e-commerce sites are good examples of aggregators, delivering goods from various sellers directly to customers’ homes.

Role of Markets in People’s Lives Markets benefit both buyers and sellers by providing access to goods and allowing people to earn a livelihood. 

They can also reflect changing trends; for instance, if more people start demanding energy-saving appliances, producers are likely to supply more of these items. In some places, markets also become social hubs, strengthening trust and community ties between generations of families and traders.

Examples like the Ima Keithal (Mother’s Market) in Manipur, run by thousands of women, show how markets can also be important for local culture and identity, besides their economic role. Sellers may give small gifts or tokens (like haldi, kumkum in South India) to buyers as a mark of goodwill.

Role of Government in Markets The government plays various roles in the market to ensure fairness and safety. It sets maximum or minimum prices for essential goods and minimum wages to protect weaker sections. 

It also requires manufacturers to follow safety and quality rules, especially for critical items like medicines and food products. Authorities regulate weights and measures to make sure customers get what they pay for.

The government also manages the harmful effects of production, such as controlling pollution or banning unsafe substances. In some cases, it directly supplies goods and services that businesses may not find profitable, like public parks, roads, or policing.

Quality Checks for Consumers To be sure about the quality of products, consumers can look for official certification marks. The FSSAI logo on food means it is safe and has been checked for standards. 

The ISI mark (from BIS) assures buyers of the quality of electrical items and construction goods. AGMARK is used for agricultural products, and BEE Star rating on appliances indicates energy efficiency. Consumers also depend on the reputation of brands, feedback from other buyers, and online reviews to make informed choices.

Key Points to Remember

• Markets allow the exchange of goods and services between buyers and sellers at prices agreed by both sides, influenced by demand and supply.
• There are various types of markets—physical, online, domestic, international, wholesale, and retail.
• The path from producer to consumer may involve wholesalers, distributors, and retailers as intermediaries.
• Markets can have a cultural and social significance, not just an economic one.
• Government roles include: fixing prices for some items, protecting consumers, regulating quality, and providing some public goods.
• Consumers should check for certification logos and reviews to ensure quality.

Class 7 Social Science Chapter 12 Notes – Understanding Markets (Key Points)

These Class 7 Social Science notes for Chapter 12, "Understanding Markets," help students quickly revise concepts like types of markets, market functioning, and government roles. Using clear examples and brief bullet points, these notes make it easy to recall facts about domestic and international markets as well as quality checks for consumers.

Summarized pointers on wholesalers, retailers, online marketplaces, and supply chains ensure comprehensive coverage for exams. Students can strengthen their answers by understanding the role of government in market regulation and gaining insights into how buyers and sellers influence pricing and trade in their communities.