Markets systems are critical to the lives and livelihoods of people, both in stable and in crisisaffected contexts. They play a vital role in meeting basic needs by supplying goods and services. They are also a key to protecting and promoting livelihoods, offering mechanisms for selling produce and providing access to paid work and income generation.
A market system is composed of the market chain (market actors and linkages between them – e.g., producers, collectors, processors, traders, consumers), supported by key infrastructure, inputs and services (e.g., storage facilities, transport networks and financial services), and influenced by enabling or disabling factors of the market environment (e.g., institutions, norms, and trends).
Crisis-affected populations interact in a wide variety of ways with market systems. Understanding these interactions as well as the market system functionality, dynamics and bottlenecks is an integral part of situation analysis and is key to efficiently supporting livelihoods. It can help reduce aid dependency by promoting long-term recovery, increasing the stability of local market systems and therefore support resilience capacities of the communities. Market system analysis can help agencies play a facilitation role rather than replacing market actors to ensure that support has a sustainable impact.
Market system mapping and analysis can be applied to a variety of sectors, such as food and agriculture (crop and livestock), as well as to other sectors such as labour, water, health and shelter.