Markets Beyond Money
Regina  Magomedzagirova Â
Markets historically played a broad set of roles Markets were centrally located and played mul8ple roles: • Economic • Social • Media • Cultural • Tolerance/diversity • Poli8cal
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The informal economy
Markets tradi3onally host informality
Informal sector (reciprocity) Informal employment Shadow economy
Markets
Unregistered workers Off books profit Extremely flexible prices ANrac8ng informal ac8vi8es Mafia Inaccurate weighing machine • Takeover of trade tent • Strategies, most profitable trading loca8on • • • • • •
Portes 1994, “the informal economy is not model of free market since it is based on personal contacts and rela8onship distor8ng pure market logic”. 4
Tradi3onal markets are in decline….is this good for Moscow? Distribu8on of profit
Mln RUB
2,415
2,248
20,364
21,420
2012
2013 Shops
Markets
Reasons markets are decreasing. • insanitary conditions • high level of criminality • ineffective use of space. Tishinka market has been replaced by hypermarket. New markets have been created but are made “chique” Source: department of trade and services in Moscow
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HYPOTHESIS 1 Informal markets (flea markets) depend on different loca8on factors than formal trade (hypermarkets). Therefore they are not compe8tors. HYPOTHESIS 2 Markets are not only economic, but are socially and culturally important.
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Markets breakdown Breakdown of Moscow markets: Informal • Farmers — 19 • Food — 26 • Car — 6 • Flea – 47 (registered – 5) • Clothing – 19 • Electronics — 9 • Book – 3 • Construc8on — 21 • Pets — 4 • Mul8purpose — 61 Formal Shopping malls — 760 Source: own research.
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Hypothesis 1: Quan3ta3ve research Spa8al units 125 districts in Moscow (excluding New Moscow). Dependent variables for 3 different models 1. Number of shopping malls 2. Number of markets in the Moscow districts 3. Flea markets in Moscow. Independent variables • Economic determinants • Social determinants • Geographic condi8ons
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Loca3on of markets in Moscow Basmanny Donskoy Izmaylovo Lyublino Maryino Otradnoye Tsaritsyno Ochakovo-‐Matveyevskoye Yasenevo Chertanovo Tsentralnoye Naga8no-‐Sadovniki Maryina Roshcha Yuzhnoportovy Meshchansky Filyovsky park
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Significant loca3on factors of markets
Markets = 0.39 + 0.02 × Busstops + 0.18 × Hotels + 0.02 × Transpots 1. 2. 3. 4. 5.
Markets are strongly correlated with public service facili8es. These areas aNract a lot of people. Business areas are not suitable for informal markets. The most important indicator for informal markets is hotels. Bus stops and tram stops prove to be essen8al to informal markets. Subways are not significant to these markets.
Source: own survey.
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Loca3on of flea markets in Moscow 1. Flea market for all people -‐ Levsha 2. Flea market for tourist -‐ Izmailovo 3. Flea market for des8tute – Shkolnaya st. 4. Informal markets near weekend fairs and pedestrian zones
Source: own survey
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Loca3on of flea markets in Moscow
Fleamarkets (number) = 0.02 Bars + 0.13 Hotels + 0.02 Parking + 0.08 PublicBuildings Fleamarkets (significance) = 0.21 + 0.09 ANrac8ons+0.28 Hotels+0.01 Tramspots 1. 2. 3. 4.
Hotels prove to be the most important indicator. Public event ac8vity is important for flea markets. Areas with weekend fairs will aNract flea markets Flea markets locate in areas with many cultural facili8es.
Source: own survey
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Hypothesis 1: Main findings 1. Markets depend on different loca8on factors to hypermarkets and retail, hence are not compe8tors 2. Unlike formal markets like hypermarkets, flea markets are not dependent on subway systems but light transport instead. They have a different geography.
Source: own survey
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Hypothesis 2: social/cultural importance Theory Formal John F. Sherry JR.: Fes8val Factory outlet marketplace Retail shop Theme park Stock market Leisure venues Economic Flea market Fes8ve Rummage sale Country fair Underground Local Fes8val economy Informal Oleg Pachenkov: “Performing some acts which look like economic, in reality people are guided by rules of daily rou8ne: naturalness, morality, unproblema8c”. 14
Flea markets demonstrate unique economic proper3es Informal economy
Despite law
Goods Criminal economy
Procedures
Beyond law
Social network
Shadow economy
Reciprocal economy
Common markets
Flea markets
Household Household economy Other names: swap meets, open-‐air markets, periodic markets, trading fairs.
Source: Barsukova S.: informal economy. 2000
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Types of flea markets Market of used goods Swap meets Williamsburg Flea (New York), Spitalfields Market (London). In Russia: Levsha, Tishinka, Izmailovo
Car boot sales
The selling of items from a car's boot (UK)
Yard sales
Garage sales (USA, UK), Vide dressing (Fr). In Russia it is quite rare phenomena
On-‐line shops
Videdressing.us or Asos marketplace, Ebay.com In Russia: avito.ru, molotok.ru
Nomadic markets
SPAM (Fr) In Russia: Lambada Market
Source: Morales, Angelia Nicole Riveira, own research.
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Flea markets are not only about money Peculiari8es of flea markets found by researchers: 1. Main advantages of flea markets were variety of goods and numerous vendors 2. Many buyers said that increasing comfort will be not good 3. Buyers wanted to distance from shopping malls where merchandisers don’t know much about goods and from on-‐line shops 4. Flea markets are not compe8tors for conven8onal types of retail since they offer used stuff and they are places for leisure Main features of flea markets: 1. Ac3ve social interac3on 2. Spontaneous purchases 3. Place where it is convenient to spend 3me with friends Source: Martha R. McEnally (1998): empirical research of flea markets.
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Flea markets in Istanbul
Source: bloha.ru
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Flea markets in Paris
Source: bloha.ru
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Flea markets in London: Portobello road
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Source: bloha.ru
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Levsha: the biggest flea market in Moscow
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Levsha: the biggest flea market in Moscow Levsha flea market
Source: own survey
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Levsha: plan of the market
Here is place for car merchandise
Vendors can build their own booth and this won’t increase lease Here is place where several illegal peddlers sell
Here is place for merchandise from floor
Drivers can see markets and quite open stop here Source: rynok-‐levsha.ru/
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Research of Levsha market Methods 1. Interviews with sellers and buyers 2. Observa8on 3. Pictures
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Assortment in market Toys, Shoes, Books, Rarity, Clothes, An8ques, Accessories, Instruments
Key findings: Two major segments of sellers: profit-‐driven and non-‐ commercial
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Assortment in market Toys, Shoes, Books, Rarity, Clothes, An8ques, Accessories, Instruments
Key findings: Many sellers (babushkas) don’t sell anything for days, key reason to be there is social interac3on
Assortment in market Toys, Shoes, Books, Rarity, Clothes, An8ques, Accessories, Instruments
Key findings: Price is almost never shown, strong tradi3on of bargaining. Even cafes and services have flexible pricing schemes
Assortment in market Toys, Shoes, Books, Rarity, Clothes, An8ques, Accessories, Instruments
Key findings: Alterna3ve pricing scenarios: e.g. asking the buyer to name a price, “heroic” and “vic3m” marke3ng strategies 228
Assortment in market Toys, Shoes, Books, Rarity, Clothes, An8ques, Accessories, Instruments
Key findings: For a certain segment, the reason to visit the market is leisure, sellers would like the market to be part of tourist guides 29
Conclusions and recommenda3ons • Shopping malls and markets are not compe8tors because they rely on different loca8on factors, and have a different geography to formal market areas • Closing big uncontrolled markets has some posi8ve effects but they can be achieved without such vigorous measure • In each country malls are the similar but markets contain na8onal and cultural iden8ty • Markets especially farmer and flea ones can become important tourist aNrac8on • To aNract more tourist and change aqtude to markets of residence authori8es should supply markets with good infrastructure and safety Source: own survey
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Future research ques3ons 1. Based on loca8on factors (H1) and social/cultural proximity (H2), which loca8ons in Moscow should be strategically developed for new informal markets? 2. Based on successful case studies in other parts of the world, how should these new informal market spaces be architecturally developed?
Source: own survey
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