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A market is any one of a variety of systems, institutions, procedures, social relationsand infrastructures whereby parties engage in exchange.

While parties may exchange goods and services by barter, most

markets rely on buyers offer their goods or services (including labor) in exchange for money (legal tender such as fiat money) from buyers.

For a market to be competitive, there must be more than a single buyer or seller. It has been suggested that two people may trade, but it takes at least three persons to have a market, so that there is competition

on at least one of its two sides.[1] However, competitive markets rely on much larger numbers of both buyers and sellers. A market with single seller and multiple buyers is a monopoly. A market with a single

buyer and multiple sellers is a monopsony. These are the extremes of imperfect competition.

Types of markets

Although many markets exist in the traditional sense such as a marketplace there are various other types of markets and various organizational structures to assist their functions. The nature of business

transactions could define markets.

[edit]Financial markets

Financial markets facilitate the exchange of liquid assets. Most investors prefer investing in two markets, the stock markets and the bond markets. NYSE, AMEX, and the NASDAQ are the most common stock

markets in the US. Futures markets, where contracts are exchanged regarding the future delivery of goods are often an outgrowth of general commodity markets.

Currency markets are used to trade one currency for another, and are often used for speculation on currency exchange rates.

The money market is the name for the global market for lending and borrowing.

[edit]Prediction markets

Prediction markets are a type of speculative market in which the goods exchanged are futures on the occurrence of certain events. They apply the market dynamics to facilitate information aggregation.

Mechanisms of markets

In economics, a market that runs under laissez-faire policies is a free market. It is "free" in the sense that the government makes no attempt to intervene through taxes, subsidies, minimum wages, price ceilings,

etc. Market prices may be distorted by a seller or sellers withmonopoly power, or a buyer with monopsony power. Such price distortions can have an adverse effect on market participant's welfare and reduce the

efficiency of market outcomes. Also, the relative level of organization and negotiating power of buyers and sellers markedly affects the functioning of the market. Markets where price negotiations meet equilibrium

though still do not arrive at desired outcomes for both sides are said to experience market failure.

The Spaniards as Colonial Masters

Spain reigned over the Philippines for 333 years, from 1565 to 1898. since Spain was far from the country, the Spanish king ruled the Islands through the viceroy of Mexico, which was then another Spanish colony. When Mexico regained its freedom in 1821, the Spanish king ruled the Philippines through a governor general. A special government body that oversaw matters, pertaining to the colonies assisted the king in this respect. This body became known by many names. Council of the Indies (1565-1837), Overseas Council (1837-1863), and Ministry of the Colonies (18631898). It is implemented the decrees and legal codes Spain promulgated although many of its provisions could not apply to condition in the colonies. It also exercised legislative and judicial powers.

The Political Structure Spain established a centralized colonial government in the Philippines that was composed of a national government and the local governments that administered provinces, cities, towns and municipalities. With the cooperation of the local governments the national government maintained peace and order, collected taxes and built schools and other public works.

The Governor General As the King's representative and the highest-ranking official in the Philippines, the governor general saw to it that royal decrees and laws emanating from Spain were implemented in the Philippines. He had the power to appoint and dismiss public officials, except those personally chosen by the King. He also supervised all government offices and the collection of taxes. The governor general exercised certain legislative powers, as well. He issued proclamations to facilitate the implementation of laws.

The Residencia This was a special judicial court that investigates the performance of a governor general who was about to be replaced. The residencia, of which the incoming governor general was usually a member, submitted a report of its findings to the King.

The Visita The Council of the Indies in Spain sent a government official called the Vistador General to observe conditions in the colony. The Visitador General reported his findings directly to the King.

The Royal Audiencia Apart from its judicial functions, the Royal Audiencia served as an advisory body to the Governor General and had the power to check and a report on his abuses. The Audiencia also audited the expenditures of the colonial government and sent a yearly report to Spain. The Archbishop and other government officials could also report the abuses of the colonial government to be Spanish king. Despite all these checks, however, an abusive governor general often managed to escape stiff fines, suspension, or dismissal by simply bribing the Visitador and other investigators.

The Provincial Government The Spaniards created local government units to facilitate the countrys administration. There were two types of local government units the alcadia and the corregimiento. The alcadia, led by the alcalde mayor, governed the provinces that had been fully subjugated: the corregimiento, headed by corregidor, governed the provinces that were not yet entirely under Spanish control. The alcalde mayors represented the Spanish king and the governor general in their respective provinces. They managed the day-to-day operations of the provincial government, implemented laws and supervised the collection of taxes. Through they were paid a small salary, they enjoyed privileges such as the indulto de comercio, or the right to participate in the galleon trade.

The Municipal Government Each province was divided into several towns or pueblos headed by Gobernadordcillos, whose main concerns were efficient governance and tax collection. Four lieutenants aided the Governardorcillo: the Teniente Mayor (chief lieutenant), the Teniente de Policia (police lieutenant), the Teniente de Sementeras (lieutenant of the fields) and the Teniente de Ganados (lieutenant of the livestock).

The Encomienda System Spain owed the colonization of the Philippines to Miguel Lopez de Legazpi, who valiantly and loyally served the Spanish crown. To hasten the subjugation of the country, King Philip II instructed Legazpi to divide the Philippines into large territories called encomiendas, to be left to the management of designated encomenderos.

To show his gratitude to his conquistadors, the King made them the first encomenderos in the colony. As the Kings representatives in their respective encomiendas, the encomenderos had the right to collect taxes. However, the encomiendas were not there to own. The encomenderos were only territorial overseers who had the duty to: 1) protect the people in the encomienda; (2) maintain peace and order; (3) promote education and health programs; and (4) help the missionaries propagate Christianity. Continue to The Galleon Trade.