Bidding Better Online in Belgium: The Value of Auction House Expertise during the COVID-19 Pandemic

In this article, we present our analysis of how one of Belgium’s largest auction houses has creatively dealt with the forced transition to online auctions during the COVID-19 pandemic. Based on in-depth qualitative interviews and participant observation conducted at Bernaerts Auctioneers in Antwerp over a period of three months between February and April 2021, we show how the auction house has succeeded at maintaining relations with its clients and the public while exclusively moving its sales online. Our specific focus was on the mediation of expertise. Drawing on recent publications from the fields of economic sociology and anthropology, we analyzed how expert narratives of origin, authenticity, and uniqueness are communicated online to affect an object’s auction value. Based on our empirical research, which also includes narrative analyses of Bernaerts Auctioneers’ internet publication Prelude, as well as content shared online via social media, we argue that expert knowledge and practices of expertise are resilient and—contrary to what neoclassical economic theory might suggest—that they continue to be central to negotiations of value, as well as in online auctions.

Rethinking the Political Economy of Development in Mao's China

This article examines two theoretical frameworks used to evaluate Maoist development. The first is based on neoclassical economic theory, and the second is rooted in the idea that the Chinese Communist Party made China into a state capitalist regime. Both these theoretical frameworks presume to know what economic practices the CCP should have engaged in and fault the Party for not conforming to their standards of judgment. This article finds this normative approach to analyzing Maoist development to be wanting for four reasons. In its drive to depict China as acting anomalously, this normative standpoint insufficiently attends to the empirical specificities of economic activities of the Mao era. It does not take enough into account how China's socialist identity shaped the CCP's economic initiatives. Nor does it dig deep enough into how the geopolitical dynamics of the Cold War influenced Chinese development. This way of writing the history of the Mao period also overlooks similarities between China and other developmental states in Cold War East Asia. This article calls on historians to adopt a different approach to the study of Chinese development and scour available documentation with the aim of comprehending the economic practices of Mao's China on their own terms.

Evolution of The Functions of Money in The Context of The Approaches of Various Schools of Economic Thought

The purpose of this paper is the identification of the functions of money and characteristic of their evolution through change of the used types of money. Research methods are a brief overview and comparative analysis of economic-theoretical approaches to the definition of the functions of money. A comparative analysis of the classifications of the functions of money, made by physiocracy, classical political economy, Marxist political economy, Austrian school of economic theory, German historical school of economics, neoclassical economic theory, Keynesianism, monetarism, institutionalism, modern monetary theory, is carried out. It is shown that various economic schools have different approaches to the definition of the functions of money. Some scientific schools separate money functions for basic and secondary, but other schools consider that all the functions are equally significant. It is concluded that modern changes in the types of money used lead to the fact that different functions of money (in particular, the functions of medium of exchange, measure of value, reserve of value, means of payment) are most effectively implemented by different types of money. Scientific novelty consists in the reconstruction and comparison of lists of functions of money identified by the most important schools of economic theory. The conclusions of the research can be used in scientific and pedagogical activities in the study of the essence and functions of money.

Labour Market Regulation and Youth Unemployment in the EU-28

The rise of youth unemployment has been one of the most serious problems which policymakers have had to deal with over the last two decades. Neoclassical economic theory suggests that the deregulation (i.e. higher flexibility) of the labour market stimulates firms to hire young people and—therefore—reduces youth unemployment. The aim of this study is to empirically test the validity of this hypothesis, analysing data on youth unemployment and labour market regulation index (LMRI) for 28 European countries in the period between 2000 and 2018. The empirical results—using two different econometric techniques (time and fixed effects that allows to take into account the presence of heterogeneity of countries in the model and pooling mean group (PMG) estimator providing results about the short and long run relationship between LMRI and youth unemployment)—do not provide evidence in support of the neoclassical hypothesis. In particular, the effect of higher flexibility of the labour market is negative and statistically significant (at 1%) only when a dummy variable for the Eastern country group is included in the model. Vice-versa, the paper shows that higher economic growth and higher investment in active labour market policy represent the key variables to reduce the youth unemployment. In conclusion, the paper raises many doubts that the introduction of flexibility measures in itself can represent a useful tool to counteract the increase of youth unemployment in Europe.

The Role of Behavioral Economics in Providing Sustainable Demand for Eco-Friendly Products

Behavioral economics theory, generated by a change in the established stereotypes of thinking of classical economists, examines processes and phenomena, taking into account psychological factors related to the processes of making irrational decisions by individuals. The purpose of the article is to determine the place and role of the behavioral economics theory in the formation of demand for eco-friendly food products, taking into account physiological primary and environmental needs and other cognitive factors that directly impact consumer behavior in a competitive market. The high degree of influence of irrational factors that are not under the control of the individual on the efficiency of the functioning of a business entity in the markets was revealed. The neoclassical economic and behavioral approaches were compared, and the shortcomings of the neoclassical economic theory and the problems that cannot be solved in practice by the neoclassical approach were identified. But these problems can be solved by using the behavioral approach. It was determined that one of the main economic components in environmentally oriented agriculture is the pricing process, or rather the impossibility of determining a reasonable price for food products. This aspect requires an assessment of rational economic indicators and consumers' level of readiness and ability to respond to changes in market conditions. Motivation significantly influences the choice of consumers in the markets. So, this study reveals the issues of the general motivational theory as part of the behavioral economics theory. Based on the assessment of the motivational aspect, the structural-logical motivational model of behavioral economics in ecologically oriented agriculture was formed; it includes cultural, economic, socio-informational factors.

Dietary Behavior and Health Outcomes

How do people choose the level of food to consume considering four important elements, namely, utility from health, health effects of food, hedonic utility from food, and diet restraint costs? The authors model dietary choice as dual-self in a principal-agent framework. The principal is concerned with long-term consequences of dietary choices, whereas the agent is in pursuit of the short-term pleasure from food consumption. Firstly, it incorporates impulsivity, an important element, which turns out to be directly related to the principal's utility from health discounted by the agent's disutility from the same health objective. A health objective could be a particular body mass index (BMI), for example. The authors show that the more distant the goal the more impulsive the individual would be. Secondly, with simple manipulations, this model gives insights into observed consumption behavior in different scenarios. When they eliminate the impulsive component from the model, results are consistent with neoclassical economic theory.

Attempt to Monopolisation and Digital Markets: Enforcement Gap

Rapid technological development, particularly in the Information and Communications Technology (ICT) sector, has led to a significant change in the industrial structure as well. Regulatory bodies world over are struggling to adjust to these changing scenarios. There is a widespread discussion regarding the need to regulate technology-driven markets such as e-commerce, telecommunication, etc. The practices used by some business giants are going against the neoclassical economic theory that profit maximisation is the goal of every firm. Firms are opting growth over profit. A large number of investigations were opened in India against business giants. Some of them were able to find contraventions of the Competition Act, 2002 (the Act). However, a large number of investigations were closed due to the lack of cognizance of collective dominance in law or inability to prove dominance in the traditional economic sense. It can be seen from the current jurisprudence of the Competition Commission of India (CCI) that there are constraints in handling competition issues in technology-driven industries mainly on account of the extant legal framework which does not recognise the need of assessing an appreciable adverse effect on competition where the dominance of the firm is not apparent. Although, the Act takes into account attempt to cartelisation as a contravention of the Act, it does not envisage an attempt to monopolise as a contravention of the Act. The past and current jurisprudence of the CCI indicates that CCI’s view is also undergoing radical change. This paper discusses the concept of “attempt to monopolise” as given in the Sherman Act and its applicability in the Indian context. The paper reviews the American antitrust literature existing on this subject and analyses the key factors which constitute antitrust violations under the clause “attempt to monopolise”. While the majority view emphasises on proving dangerous probability of success while determining an attempt to monopolise, as per the minority view, “attempt” connotes conduct and not a state of being. Unlawful intent can be inferred from the conduct as a proof of an “attempt”. The law does not require completion of a crime, it requires conduct. Thus, an attempt to monopolise is a conduct offence. This paper argues that borrowing the attempt to monopolise concept from the Sherman Act, 1890 will be helpful for the CCI in handling antitrust cases in technology-driven industries such as e-commerce, telecommunications, transport, etc. It will go a long way in achieving competitive markets, increased consumer choice and welfare in the long-run.

Revisiting Raúl Prebisch’s concept of crisis

This article offers a review and appraisal of the concept of crisis in the context of the remarkable trajectory and works of argentine economist Raul Prebisch. It argues that the crisis of the 1930s is the foundation of Prebisch’s theoretical proposal on dependency and development in Lat-in America. The crisis of 1929-1930 was the turning point that encour-aged him to revise and reinvent neoclassical economic theory, promote industrialization and import substitution, and, more importantly, to deeply restructure the role of the State in the region. The crisis leads to decision and action, and it implies and orientation towards the future, a new “horizon of expectations.” This horizon throughout the most part of the twentieth century in Latin America was development. The article also puts forward an interpretation of his program at the Economic Commission for Latin America and the Caribbean (ECLAC/CEPAL), also triggered by the crisis and oriented to the formulation of policies meant to overcome the crisis. Finally, the article shows how through his interactions with CEPAL sociologists, in particular José Medina Echavarría, Prebisch proposes a redefinition of his concept of crisis, shifting from an economic and junctural concept to a structural one: the crisis of peripheral capitalism

Once Again About Political Economy as a Scientific and Educational Discipline (on the Debated Aspects of the Problem)

Russian scientific economic literature continues to discuss the problem of the modern evolution of political economy as a science and its return as an academic discipline in the number of mandatory university courses. In this regard, the article, firstly, examines the historical fate and the current state of Marxist political economy, emphasizes its fundamental difference from other economic theories. Secondly, — considerable attention is paid to neoclassical economic theory and an academic discipline called «economics». The historical circumstances of the emergence of this term are shown and the place of neoclassicism in the Western classification of economic sciences is characterized. Thirdly, — for a comprehensive analysis of the economy, it is proposed to use general economic theory as a combination (a special kind of aggregate) of all modern schools, directions and programs of economic theory, unified in the object, but differing in the subject and method of research. It is emphasized that the role of the basis and historically and logically the initial component of this theory is played by political economy.

Why property market forecasts fail

PurposeThe paper addresses the puzzling phenomenon of the ubiquity of economic forecasting, of which property market forecasting is but one instance, on the one hand, and the unreliability of such forecasts, on the other hand. The paper explains why property market forecasts fail, in a non-trivial sense, and why this problem is irredeemable.Design/methodology/approachThis was a conceptual paper and was based on original thought and literature review.FindingsThis paper attributes the failure of property market forecasts to the inappropriate application of the methodology of the natural sciences to the social sciences by mainstream economics. Specifically, the problem is located in the positivist philosophy and the assumptions of methodological individualism and rational choice theory underlying neoclassical economic theory.Originality/valueThe paper makes an original contribution by clearly showing why and how the methodology of the natural sciences, especially physics, has been applied to economics and property market analysis, why this is inappropriate and why it leads to failure. The paper introduces a debate that has hitherto been mostly confined to philosophy and mainstream economics into the property or real estate discipline and in a manner that is accessible to a non-philosophy audience.