The word bazaar is
Persian for “place of prices” and historically described an enclosed and
covered area housing numerous privately operated booths trafficking in
commodity goods. These markets have existed in both western and eastern
cultures for thousands of years. In the book, Bazaar and State in Iran, Arang Keshavarzian defines a bazaar as “a
series of socially embedded networks within a bounded space that is the
mechanism for the exchange of specific commodities.” (Keshavarzian 2007) . These ancient marketplaces
served as the central economic institution for trade and became the hub of not
only market activity, but also political, religious, and social interchange.
Many large shopping malls, international airports, and even state universities
of today share much with the economic model of the bazaar.
Foundationally, the bazaar catallaxy begins with the
designation of a bounded space to be used for a single primary purpose. In the
case of the ancient market bazaars, this purpose was trade. This same
requirement for common purpose is at the center of modern examples—transportation
for airports, shopping for malls, and education for universities—each requiring
the allocation of a large bounded space. The first element of entanglement of
polity and economy usually begins with the acquisition of these spaces, which
is easily accomplished when wielding the coercive power of government eminent domain.
One of the largest and most successful bazaars was the
Nizhnii Novgorod Fair, founded in 1817 and situated on the Balakhonskaia
Peninsula at the confluence of the Oka and Volga rivers (Fitpatrick 1990) . Marshaling the skills of
architects under government contract, the location and construction of the fair’s
infrastructure arose in much the same way airports or malls emerge today (Coburn 2011) .
In the Nizhnii Novgorod Fair, the regional government provided the policing and
sewage control as well. Patrons tend to think of the plurality of vendors in a
bazaar catallaxy as a single entity—“Do you want to go shopping at the mall?”
rather than to a specific store. This perception allows the creator/owner of a
bazaar to provide services as a market maker.
Structurally, the bazaar consists of a set of horizontally competitive enterprises residing within the bounds of the catallaxy as shown in Figure 1(H1, H2, H3, H4, …). The horizontal business units, while competitive with each other, form a critical mass that draws not only large numbers of customers, but also vertical or supporting services (V1, V2, V3, V4, V5, …) such as money changing, food courts, transportation, and possibly even housing. The bazaar entanglement of polity and economy increases further when the polity provides some of these ancillary services—most often policing and utilities, as represented by element V0 in Figure 1. The vertical services in a bazaar, when not provided by the polity, tend to consist of competitive offerings. For example, in an airport there will be multiple transportation services including private automobiles, taxicabs, metro lines, rental cars, and buses. Food and shopping services will be varied, as will on-property hotels if any.
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| Figure 1 |
Structurally, the bazaar consists of a set of horizontally competitive enterprises residing within the bounds of the catallaxy as shown in Figure 1(H1, H2, H3, H4, …). The horizontal business units, while competitive with each other, form a critical mass that draws not only large numbers of customers, but also vertical or supporting services (V1, V2, V3, V4, V5, …) such as money changing, food courts, transportation, and possibly even housing. The bazaar entanglement of polity and economy increases further when the polity provides some of these ancillary services—most often policing and utilities, as represented by element V0 in Figure 1. The vertical services in a bazaar, when not provided by the polity, tend to consist of competitive offerings. For example, in an airport there will be multiple transportation services including private automobiles, taxicabs, metro lines, rental cars, and buses. Food and shopping services will be varied, as will on-property hotels if any.
An important phenomenon of the bazaar is the partnerships
that often form between competing horizontal firms. In Afghan bazaars, these loosely
bound guilds are known as quams (Coburn 2011) .
In airports, the airlines organize into quams
as a way of dealing with difficulties such as mechanical failures, bumped
passengers, and as a way of extending their market reach. If American Airlines
suffers from a mechanical failure, they have the ability to electronically
transfer bumped passengers and luggage directly to a competitor’s flight. These
quams also extend their membership to
include vertical services such as hotels for weather-stranded passengers and
meal coupons accepted by airport restaurants. The close proximity and shared
infrastructure of the bazaar makes this kind of collaboration simple and
worthwhile to implement.
International airports present another set of administrative
challenges, because their primary purpose is cross-border travel, which
requires them to deal with such things as immigration rules, import and export
duties, and potentially incompatible security standards. These regulatory
aspects of travel present additional opportunities, and perhaps excuses, for
the polity to further imbed itself into the catallaxy.
Whatever the primary service offering of the bazaar, the
homogeneity of the horizontal competition and the well-defined nature of the vertical
and ancillary services make the bazaar catallaxy highly susceptible to active
participation on the part of the polity.
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Works Cited
Coburn, Noah. Bazaar Politics: Power and Pottery
in an Afghan Market Town. Stanford,
CA: Stanford University Press, 2011.
CA: Stanford University Press, 2011.
Fitpatrick, Anne
Lincoln. The Great Russian Fair: Nizhnii Novgorod, 1840-1890. New
York: St. Martin's Press, 1990.
York: St. Martin's Press, 1990.
Keshavarzian, Arang. Bazaar
and State in Iran. Cambridge: Cambridge University Press,
2007.
2007.
