The Market as a Social Institution

The Market as a Social Institution

Question

How many caste and kin networks contribute to the success of a business?

Answer

Contribution of caste and kin to success of a business.

(i)    Castes had their own systems of banking and credit E.g—Hundi (credit note instrument) allows merchants to engage in long-distance trade.

(ii)    A merchant in one part of the country was allowed to issue a Hundi that would be honoured by merchant in another place because of caste and kinship networks.

(iii)    Communities like Nattukottai of Tamil Nadu had developed their own trading networks. Their banking and trade activities were embedded in the social organisation.

(iv)    Banks were basically joint family firms and structure of business firm was the same as that of the family.

(v)    Prior to colonial period, there was Jajmani system or non-market exchange system in vogue. It was also based on caste and kin-ties.

(vi)    The structures of caste, kinship and family were oriented towards commercial activity and business was carried out within these social structures.

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