Editing Commerce

{{Short description|Exchange of goods and services}}
{{About|the business concept}}
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'''Commerce''' is the organized [[Complex system|system]] of activities, functions, procedures and institutions that directly or indirectly contribute to the smooth, unhindered large-scale distribution and [[trade|transfer]] (exchange through [[Financial transaction|buying and selling]]) of [[goods and services|goods, services,]] and other things of value at the right time, place, quantity, [[Quality (business)|quality]] and [[price]] through various [[Distribution (marketing)#Channels and intermediaries|channels]] among the original [[Economic production|producer]]s and the final [[consumer]]s within local, regional, national or international economies.<ref>{{Cite OED|Commerce|id=37073}}</ref><ref>{{citation |title=Principles and Practice of Commerce |author=James Stephenson |year=1942 |publisher=Sir Issac Pitman & Sons, Ltd |page=95 |place=London}}</ref><ref>{{Cite web |title=Commerce Definition & Meaning {{!}} Britannica Dictionary |url=https://www.britannica.com/dictionary/commerce |access-date=2024-12-03 |website=www.britannica.com |language=en-US |quote=commerce: activities that relate to the buying and selling of goods and services}}</ref><ref>{{Cite web |title=COMMERCE |url=https://www.collinsdictionary.com/dictionary/english/commerce |website=Collins Dictionary |quote=Commerce is the activities and procedures involved in buying and selling things.}}</ref><ref name=OXDICT>{{Citation |title=A Dictionary of Business and Management |editor=Jonathan Law |page=26 |year=2016 |edition=6th |publisher=Oxofrd University Press}}</ref> The diversity in the distribution of [[natural resource]]s, differences of human [[need]]s and [[want]]s, and [[division of labour]] along with [[comparative advantage]] are the principal factors that give rise to commercial exchanges.<ref>{{citation |title=Principles and Practice of Commerce |author=James Stephenson |year=1942 |publisher=Sir Issac Pitman & Sons, Ltd |page=14 |place=London}}</ref>

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Commerce consists of [[trade]] and aids to trade<ref name=OXDICT>{{Citation |title=A Dictionary of Business and Management |editor=Jonathan Law |page=26 |year=2016 |edition=6th |publisher=Oxofrd University Press}}</ref> (i.e. auxiliary commercial services) taking place along the entire [[supply chain]]. Trade is the exchange of goods (including [[raw material]]s, [[intermediate good|intermediate]] and [[finished good]]s) and services between [[Consumer|buyers]] and [[Sales|sellers]] in return for an [[Offer and acceptance|agreed-upon price]] at traditional (or [[Online marketplace|online]]) [[marketplace]]s. It is categorized into [[Domestic market|domestic trade]], including [[retail]] and [[wholesale]] as well as local, regional, inter-regional and [[International trade|international/foreign trade]] (encompassing [[import]], [[export]] and [[Re-exportation|entrepôt/re-export]] trades). The exchange of [[currencies]] (in [[foreign exchange market]]s), [[commodities]] (in [[commodity market]]s/exchanges) and [[securities]] and [[derivative (finance)|derivatives]] (in [[stock exchange]]s and [[financial market]]s) in specialized [[Exchange (organized market)|exchange]] markets, typically operating under the domain of [[finance]] and [[investment]], also falls under the umbrella of trade. On the other hand, auxiliary commercial activities (aids to trade) which can facilitate trade include commercial [[intermediary|intermediaries]], [[banking]], credit financing and related services, [[transportation]], [[packaging]], [[warehousing]], [[communication]], [[advertising]] and [[insurance]]. Their purpose is to remove hindrances related to direct personal contact, [[payment]]s, [[savings]], [[funding]], separation of place and time, product protection and preservation, [[knowledge]] and [[risk]].

The broader framework of commerce incorporates additional elements and factors such as [[commercial law|laws and regulations]] (including [[intellectual property rights]] and [[antitrust law]]s), [[Commercial policy|policies]], [[tariff]]s and [[trade barrier]]s, [[consumer]]s and [[Consumer behaviour|consumer trend]]s, [[Production (economics)|producer]]s and production strategies, supply chains and their [[supply chain management|management]], [[financial transaction]]s for ordinary and extraordinary business activities, [[market (economics)|market]] dynamics (including [[supply and demand]]), [[technological innovation]], [[Competition (economics)|competition]] and [[entrepreneurship]], [[trade agreement]]s, [[multinational corporation]]s and [[small and medium-sized enterprises]]s (SMEs), and [[Macroeconomics|macroeconomic factors]] (like [[economic stability]]).

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Commerce drives [[economic growth]], [[Economic development|development]] and [[prosperity]], promotes regional and international [[Economic interdependence|interdependence]], fosters [[cultural exchange]], [[Unemployment#Remedies|creates]] [[job]]s, improves people's [[standard of living]] by giving them access to a wider variety of goods and services, and encourages [[innovation]] and competition for better [[Product (business)|product]]s. On the other hand, commerce can worsen [[economic inequality]] by [[Distribution of wealth|concentrating wealth]] (and [[Economic power|power]]) into the hands of [[Oligopoly|a small number of individuals]], and by prioritizing short-term [[profit (economics)|profit]] over long-term sustainability and [[business ethics|ethical]], [[Corporate social responsibility|social]], and environmental considerations, leading to [[environmental degradation]], [[labor exploitation]] and disregard for [[consumer safety]]. Unregulated, it can lead to [[Overconsumption (economics)|excessive consumption]] (generating [[Global waste trade|undesirable waste]]) and [[overexploitation|unsustainable exploitation]] of nature (causing [[resource depletion]]). Harnessing commerce's [[Externality#Positive|benefits]] for the society while mitigating its [[Externality#Negative|drawbacks]] remains vital for [[Commercial policy|policymaker]]s, [[business]]es and other [[Stakeholder analysis|stakeholder]]s, who are increasingly adopting [[Sustainable business|sustainable practices]], [[Ethical consumerism|ethical sourcing]], and [[circular economy]] models,

<!--short history and current state-->Commerce traces its origins to ancient localized [[barter]] systems, leading to the establishment of periodic marketplaces, and culminating in the development of [[currency|currencies]] for [[efficiency|efficient]] trade. In medieval times, [[trade route]]s (like the [[Silk Road]]) with pivotal commercial hubs (like [[Venice]]) connected regions and continents, enabling long-distance trade and [[cultural exchange]]. From the 15th to the early 20th century, [[European colonialism|European colonial powers]] dominated global commerce on an unprecedented scale, giving rise to maritime trade empires with their powerful colonial trade companies (e.g., [[Dutch East India Company]] and [[British East India Company]]) and ushering in an unprecedented global exchange (see [[Columbian exchange]]). In the 19th century, [[History of banking#The modern bank|modern bank]]ing and related international markets along with the [[Industrial Revolution]] fundamentally reshaped commerce. In the [[decolonization|post-colonial]] 20th century, [[free market]] principles gained ground,  [[multinational corporation]]s and [[consumer economy|consumer economies]] thrived in U.S.-led [[Western bloc|capitalist countries]] and [[free trade]] [[Trade agreement|agreements]] (like [[GATT]] and [[WTO]]) emerged, whereas [[Eastern bloc|communist]] economies encountered [[trade restriction]]s, limiting [[consumer choice]]. Furthermore, in the mid-20th century, the adoption of [[Intermodal container|standardized shipping containers]] facilitated seamless and efficient [[intermodal freight transport]], leading to a surge in international trade. By the century's end, [[Developing country|developing countries]] saw their share in world trade rise from a quarter to a third.<ref>{{Cite web |title=Global Trade Liberalization and the Developing Countries |author=IMF Staff |date=November 2001 |website=International Monetary Fund |url=https://www.imf.org/external/np/exr/ib/2001/110801.htm}}</ref> 21st century commerce is increasingly [[information technology|technology-driven]] (see [[e-commerce]], [[Marketing and artificial intelligence|role of artificial intelligence]] and [[Marketing automation|automation]]), [[economic globalization|globalized]], intricately [[Commercial law|regulated]], [[ethics|ethically]] responsible and [[sustainability]]-focused (e.g., [[Climate resilience|climate-resilient]] trade practices), with [[multilateralism|multilateral]] [[economic integration]]s (like the [[European Union]]) or coalitions (like [[BRICS]]),<ref>{{Citation |journal=The Pacific Review |volume=34 |year=2021 |issue=1 |title=China, the BRICS, and the limitations of reshaping global economic governance |author=Bas Hooijmaaijers |pages=29–55|doi=10.1080/09512748.2019.1649298 }}</ref> [[gig economy]] and platform-based [[uberisation]] of services, [[Geopolitics|geopolitical shift]]s and [[trade war]]s leading to its reconfiguration.  
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Commerce in ancient age featured localized [[barter]] trade systems and limited long-distance trade, followed by the development of [[currency|currencies]] for greater [[efficiency]] and [[standardization]] in response to growth and complexity. In medieval times (5th-15th century), intra-continental [[trade route]]s (e.g. the [[Grand Trunk Road]], the [[Amber Road]], the [[Tea Horse Road]] and the [[Trans-Saharan trade]]) and intercontinental trade networks (e.g. the Silk Road and the [[Indian Ocean trade]] routes) emerged to connect diverse regions with long-distance commerce and fostered [[cultural exchange]], as strategical crossroad cities (e.g. [[Venice]], [[Constantinople]], [[Alexandria]], [[Timbuktu]], [[Baghdad]], [[Samarkand]] and [[Guangzhou]]) served as pivotal commerce hubs. From the 15th to the early 20th century, [[European colonialism|European colonial powers]], beginning with the [[Age of Discovery]], globally dominated commerce with an unprecedented reach through maritime expansion, resource extraction, infrastructure development, [[mercantilism]] and global trade networks. In the 19th and 20th centuries, [[industrial revolution]] and technological innovations reshaped commerce by fostering [[global trade]], helping the [[decolonization|post-colonial]] emergence of [[multinational corporation]]s, and the development of the modern [[consumer economy]]. In the 21st century, commerce is increasingly [[information technology|tech-driven]], influenced by [[economic globalization]], subject to complex [[Commercial law|laws]] and [[Regulatory economics|regulations]] encompassing quality, [[product safety|safety]], [[tax compliance|taxation]], [[market stability]], [[fair competition]] and [[consumer protection]], and emphasizes ecological [[sustainability]], [[ethics]] and [[social responsibility]].
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==Etymology==
The English-language word ''commerce'' has been derived from the [[Latin]] word {{lang|la|commercium}}, from {{lang|la|com}} ("together") and {{lang|la|merx}} ("merchandise").<ref>{{cite EB1911 |wstitle= Commerce |volume= 6 |pages= 766-770 }}</ref>

==Relation to business and trade==
{{morerefs|section|date=February 2024}}
Despite many similarities (to the extent that they are sometimes used as synonyms in layman's terms and in other contexts), commerce, [[business]] and [[trade]] are distinct concepts.

===Commerce and business===
Commerce deals with buying, selling and distribution of goods and services from producers to customers as well as related matters such as marketing, finance, laws, transportation and insurance.<ref>{{Cite web |title=COMMERCE |url=https://dictionary.cambridge.org/dictionary/english/commerce |website=Cambridge Dictionary |quote=commerce : the activities involved in buying and selling things}}</ref><ref name=OXDICT></ref><ref>{{Citation |title=Cambridge O Level Commerce Coursebook |author= Mary Trigwell-Jones |publisher=Cambridge University Press |year=2016 |page=19}}</ref>

In a general sense, business is the activity of earning money and making one's living through engaging in commerce.<ref>{{cite encyclopedia|url=https://en.oxforddictionaries.com/definition/us/business|title=Oxford Living Dictionaries|archive-url=https://web.archive.org/web/20190501064740/https://en.oxforddictionaries.com/definition/us/business|archive-date=May 1, 2019|quote=business [:] 2 The practice of making one's living by engaging in commerce.}}</ref> The  difference between business and commerce is that business can also refer to a [[commercial entity]], such as a company.<ref>{{Cite web |title=business |url=https://dictionary.cambridge.org/dictionary/english/business |website=Cambridge Dictionary |quote=business : a particular company that buys and sells goods and services}}</ref> So, in a more specific sense, a business is an organization or activity for making a profit by providing goods and services which meet the needs of its customers or consumers.<ref>{{Cite web |url=https://openstax.org/books/introduction-business/pages/1-1-the-nature-of-business |department=Understanding Economic Systems and Business |title=Introduction to Business |page=12 |year=2018 |publisher=Openstax - Rice University}}</ref>

Viewed in this way, commerce is a broader concept and an overall, all-encompassing aspect of business. Commerce provides the underlying large-scale transactional environment comprising all kinds of exchanges within which individual business organizations operate for generating profits.

===Commerce and trade===
Commerce is distinguishable from [[trade]] as well. Trade is the transaction (buying and selling) of goods and services that makes a profit for the seller and satisfies the want or need of the buyer. When trade is carried out within a country, it is called home or [[domestic trade]], which can be [[Wholesaling|wholesale]] or [[retail]]. A wholesaler buys from the producer in bulk and sells to the retailer who then sells again to the final consumer in smaller quantities. Trade between a country and the rest of the world is called foreign or [[international trade]], which consists of [[import]] trade and [[export]] trade, both being wholesale in general.

Commerce not only includes trade as defined above, but also the auxiliary services or aids to trade<ref name=OXDICT/> and means that facilitate such trade. Auxiliary services aid trade by providing services which such as [[transportation]], [[communication]], [[warehousing]], [[insurance]], [[banking]], credit financing to companies, [[advertising]], [[packaging]], and the services of commercial agents and agencies. In other words, commerce encompasses a wide array of political, economical, technological, logistical, legal, regulatory, social and cultural aspects of trade on a large scale. From a [[marketing]] perspective, commerce creates time and place utility by making goods and services available to the customers at the right place and at the right time by changing their location or placement.

Described in this manner, trade is a part of commerce and commerce is an aspect of business.

==History==
[[File:Caduceus.svg|thumb|upright=0.45|The [[caduceus]] – used today as the symbol of commerce,<ref>Hans Biedermann, James Hulbert (trans.), ''Dictionary of Symbolism - Cultural Icons and the Meanings behind Them'', p. 54.</ref> and traditionally associated with the Roman god [[Mercury (mythology)|Mercury]], patron of commerce, trickery and thieves]]

Historian [[Peter Watson (business writer)|Peter Watson]] and Ramesh Manickam date the [[History of international trade|history of long-distance commerce]] from [[Wiktionary:circa|circa]] 150,000 years ago.<ref>{{cite book | author = Watson, Peter | title = Ideas : A History of Thought and Invention from Fire to Freud | publisher = HarperCollins | year = 2005| isbn = 0-06-621064-X}} Introduction.</ref> In historic times, the introduction of [[currency]] as a standardized [[money]] facilitated the exchange of goods and services.<ref>{{cite book | author= Davies, Glyn | title = Ideas: A history of money from ancient times to the present day | publisher = University of Wales Press | year = 2002| isbn = 0-7083-1717-0}}</ref>

Commerce was a costly endeavor in the antiquities because of the risky nature of transportation, which restricted it to local markets. Commerce then expanded along with the improvement of transportation systems over time. In the Middle Ages, long-distance and large-scale commerce was still limited within continents. [[Banking system]]s developed in medieval Europe, facilitating financial transactions across national boundaries.<ref name="Howell2010">{{cite book |author=[[Martha C. Howell]] |url=https://books.google.com/books?id=ZKhZTqkqfkEC |title=Commerce Before Capitalism in Europe, 1300-1600 |date=12 April 2010 |publisher=Cambridge University Press |isbn=978-0-521-76046-1}}</ref> [[Marketplace|Market]]s became a feature of town life, and were regulated by town authorities.<ref name="Braudel1982">
{{cite book
|author= Fernand Braudel
|title= Civilization and Capitalism, 15th-18th Century: The wheels of commerce
|url= https://books.google.com/books?id=WPDbSXQsvGIC
|year= 1982|publisher= University of California Press
|isbn= 978-0-520-08115-4|page= 30
|quote= Taken over by towns, the markets grew apace with them.
}}
</ref> With the advent of the [[Age of Discovery]] and oceangoing ships, commerce took an international, trans-continental stature.

Currently the reliability of international trans-oceanic shipping and mailing systems and the facility of the Internet has made commerce possible between cities, regions and countries situated anywhere in the world. In the 21st century, Internet-based [[electronic commerce]] (where financial information is transferred over Internet), and its subcategories such as wireless [[mobile commerce]] and [[social network]]-based [[social commerce]] have been and continue to get adopted widely.

==Regulation==
{{Main|Commercial law}}
Legislative bodies and ministries or ministerial departments of commerce regulate, promote and manage domestic and foreign commercial activities within a country. International commerce can be regulated by bilateral treaties between countries. After the second world war and the rise of free trade among nations, multilateral arrangements such as the [[GATT]] and later the [[World Trade Organization]] became the principal systems regulating global commerce. The [[International Chamber of Commerce]] (ICC) is another important organization which sets rules and resolves disputes in international commerce.

Where national [[government bodies]] undertake commercial activity with or inside other states, this commercial activity may fall outside the protection of the international rules which govern legal relationships between independent states: see, for example, the "commercial activity exception" applicable under the United States' [[Foreign Sovereign Immunities Act]] of 1976.

==See also==
{{cols|colwidth=13em}}
* [[Bachelor of Business Administration]]
* [[Bachelor of Commerce]]
* [[Master of Commerce]]
* [[Doctor of Commerce]]
* [[Capitalism]]
* [[Cargo]]
* [[Commerce clause]]
* [[Commercial management]]
* [[Commercial law]]
* [[Eco commerce]]
* [[Economics]]
* [[Fair]]
* [[Financial planning (business)]]
* [[Laissez-faire]]
* [[Market (economics)]]
* [[Marketplace]]
* [[Mass production]]
* [[Merchandising]]
* [[Value (economics)]]
{{colend}}

==References==
{{reflist}}

== External links ==
{{wiktionary}}
* {{cite EB9 |wstitle = Commerce |volume= VI  |last= Somers |first= Robert |author-link= Robert Somers| pages=196-207 |short=1 }}

{{Authority control}}

[[Category:Trade]]