How much is a human skull worth? Hamlet certainly prized poor Yorick’s, and Dr. Mortimer admitted that even a cast of Sherlock Holmes’s noggin “would be an ornament to any anthropological museum.” Pol Pot valued them in his own demented way, enough to use 300 or so to make a map of Cambodia. And for British artist Damien Hirst, a skull is worth $100 million in cash, and not just because it’s encrusted with $30 million worth of diamonds. Most of its value comes from the fact that Hirst dreamt it up and gave it one of his characteristically daring yet silly titles: For the Love of God.

Hirst’s skull is but a small part of a contemporary art market that, to the uninitiated, seems preposterous. But as Toronto’s Don Thompson shows in his comprehensive new account of the world of contemporary art, there’s a reason people are willing to pay $3 million for a cast of Marc Quinn’s head made from nine pints of the artist’s frozen blood. An economics professor first and an art collector second, Thompson is interested in “what makes a particular work of art valuable, and by what alchemy it is seen as worth $12 million or $100 million rather than, say, $250,000.” Over the course of this impeccably researched inquiry, he does a very good job of finding out.

More often than not, Thompson argues, it’s a powerful combination of what he terms branded artists, branded auction houses, branded dealers, and branded collectors acting within a market where “branding can substitute for critical judgment.” (The unbelievable sale price of Hirst’s skull, for instance, resulted from the particularly valuable union of the world’s most branded artist and one of the world’s most branded dealers, White Cube’s Jay Jopling.) But despite the dizzying extravagance of the world he explores, Thompson’s work remains grounded in hard analysis. And in describing a world that seems insane in its fervour, lust, and escalation, his steady, thorough, and even approach is refreshingly cool.