The Economist explains what’s going on with China’s luxury market by way of reference to Xi Jiping’s anti-corruption campaign. The main issue, as it relates to the art market, is that China’s culture of gift-giving has been impacted far more than its conspicuous consumption.

So many of the expensive presents that were once offered as part of doing business in China are being discouraged. For the art market, this affects the middle of the market and the trafficking in fakes as a medium for bribes but not the very top end where works are prized trophies.

The Economist uses the market for Tibetan Mastiff’s to illustrate the issue:

At the top end of the mastiff business, it is not so bleak. In 2011 a coal baron is said to have paid 10m yuan ($1.5m) for Big Splash, a Tibetan mastiff puppy. In 2014 a property developer paid 12m yuan for a dog, making it the world’s most expensive canine. Han Lianming, a mastiff breeder near Beijing, says the market for such finest-quality dogs still looks good. “Someone offered me 20m yuan for that one. It was crazy,” he says contentedly, pointing to a vast ball of russet fur and teeth that is lumbering around the courtyard (the deal did not come off). A select few millionaires appear immune to the anti-corruption campaign and unfazed by dog-breeders’ efforts during the boom years to boost supply by crossbreeding. This diminished the rarity-value of mastiffs, but it also produced some highly sought-after specimens.

Million dollar mastiffs  (The Economist)