The Paradox of Value and Economic Bubbles: New Insights for Sustainable Economic Development
by
Inna Gryshova 1, Tatyana Shabatura 1
, Stasys Girdzijauskas 2,*, Dalia Streimikiene 2,*, Remigijus Ciegis 2 and Ingrida Griesiene 2
Inna Gryshova 1, Tatyana Shabatura 1, Stasys Girdzijauskas 2,*, Dalia Streimikiene 2,*, Remigijus Ciegis 2 and Ingrida Griesiene 2
1
JSNU-SPbPU Institute of Engineering-Sino-Russian Institute, Jiangsu Normal University, 101 Shanghai Rd, Tongshan Qu, Xuzhou 221100, Jiangsu, China
2
Kaunas Faculty, Vilnius University, Muitinės str. 8, LT-44280 Kaunas, Lithuania
*
Authors to whom correspondence should be addressed.
Sustainability 2019, 11(24), 6888; https://doi.org/10.3390/su11246888
Received: 31 October 2019 / Revised: 27 November 2019 / Accepted: 28 November 2019 / Published: 4 December 2019
The article presents a new approach to the solution to the paradox of value based on the theory of marginal utility of the Austrian School of Economics. The new approach is based on the theory of compound interests and economic bubbles. The study presents valuable theoretical insight towards sustainable economic development. The paper provides a brief formulation of the theory of compound interests, introduces the structure of compound interests model, and shows the relations between simple and compound interests as well as dimensionless interests. It reveals the saturation phenomena, and emphasizes its impact on economic and financial bubbles. The relation between the value of paradox and the price bubbles is presented. The article also explains the possibilities of the phenomenology of growth in formulating the paradox of saturation and studying the paradox of value. The phenomenological method allows to relate prices and financial and economic bubbles into a general entirety. Therefore, this paper deals with very important sustainable development issues as it discusses the market saturation phenomena, economic bubbles, and emotional consumer behavior. The limitations of behavioral theories are pointed out and their misunderstandings of information cascades are emphasized. The article provides the explanation of the nature of economic bubbles by employing the theory of compound interests.
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Keywords:
sustainable economic development; economic bubbles; market saturation phenomena; paradox of value
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MDPI and ACS Style
Gryshova, I.; Shabatura, T.; Girdzijauskas, S.; Streimikiene, D.; Ciegis, R.; Griesiene, I. The Paradox of Value and Economic Bubbles: New Insights for Sustainable Economic Development. Sustainability 2019, 11, 6888.
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