BEHAVIORAL COMPONENTS IN RELATIONSHIPS OF ECONOMIC AGENTS (EXAMPLE OF THE UKRAINIAN CAR MARKET)

Glib Mazhara and Volodymyr Kapustian
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Glib Mazhara: National Technical University of Ukraine «Kyiv Polytechnic Institute Igor Sikorsky»
Volodymyr Kapustian: National Technical University of Ukraine «Kyiv Polytechnic Institute Igor Sikorsky»

EUREKA: Social and Humanities, 2020, issue 2, 8-14

Abstract:

In neoclassical economics a concept of individual is seen as a logical thinking machine, which accurately analyzes all information received and, based on it, makes decisions that maximize his/her personal gain and minimize risks while achieving his/her goals. Such behavior of a person is called rational. Such concept serves as a source of neoclassicism for the construction of supply and demand models, operation of tax systems, business cycles, inflation etc. It was not accepted to pay attention to the psychology of decision-making, it was believed, that these transient, random factors pale against the grandeur of economic incentives. Psychologists are interested in solutions that are emotional, casual, pursued by some sort of cultural ideas, norms, rules, and may even be phobias, conversely economics is the science of rational behavior. The purpose of this paper is to identify and analyze the behavioral components and their influence on the interaction of economic agents in the commodity market. The study used methods of constructing a multivariate regression model, OLS, Student and Fisher criteria, statistical research, sociological surveys and expert opinion. Authors will analyze the behavioral aspects of market relationships on the example of used car market in Ukraine This paper provides several different situations and tested them with real market data to demonstrate that both buyers and sellers may not act rationally on the market, set prices, based on their personal beliefs, subjective and psychological factors and that must be considered when building economical models.

Keywords: behavioral economics; classical theories; models of multivariate regression (search for similar items in EconPapers)
Date: 2020-03-31
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