In economics, a commodity is the generic term for any marketable item produced to satisfy wants or needs. Economic commodities comprise goods and services. The more specific meaning of the term commodity is applied to goods only. It is used to describe a class of goods for which there demand is, but which is supplied without qualitative differentiation across a market.

A commodity has full or partial fungibility; that is, the market treats it as equivalent or nearly so no matter who produces it. Petroleum and copper are examples of such commodities. The price of copper is universal, and fluctuates daily based on global supply and demand.

Items such as stereo systems, on the other hand, have many aspects of product differentiation, such as the brand, the user interface, the perceived quality etc. And, the more valuable a stereo is perceived to be, the more it will cost.