New Liverpool chief executive Peter Moore wants the club to spend smartly even if their rivals are splashing the cash, pointing to Philippe Coutinho as an example of wisely using transfer funds.
Moore started his job on Thursday, replacing Ian Ayre, whose six-year spell in the role came to an end in February.
While he said Liverpool have "tremendous resources" available and will look to build a big squad now that Jurgen Klopp has led the club back to the Champions League, they will not be forced into big purchases based on other teams' business.
Coutinho, who joined from Inter in January 2013, is the type of value buy Moore is seeking, even if sides like Chelsea and Manchester City are signing stars at the top of the market.
"What I have learned over the years is that it is not how much you pay but what you get," Moore told reporters.
"You have a kid called Philippe Coutinho playing out there who cost £8million and then you have other guys who cost four or five times that around the league.
"That is not about, 'we have spent a lot of money so we are good' that is about, 'we have bought the right players at the right price'.
"Everyone wants to see massive money but what I want to see is talent for the right price. I might be naive in that but that seems good business.
"It's not about saying: 'They've spent £100m so we will spend £100m.' I'm not looking at my competitor - let's call City a competitor - spending this, therefore I need to spend that regardless of the quality of the players. That makes no business sense to me.
"Listen, we may spend £100m. Who knows? But it won't be because they spend £100m. If your next-door neighbour puts £50,000 into his greenhouse will you spend £50,000 on a greenhouse? No. You do what makes good sense for your house.
"But this is not about if Chelsea spend a pound then we have to spend a pound regardless of the quality of the player we are looking at.
"This is less about an arms race for spending as much money as we can, it's more about spending smartly. There are tremendous resources that are available for this club here. Our focus is to buy the right players, get the right value, strengthen the squad."
Virgil van Dijk and Naby Keita are reported transfer targets for the Reds, who have signed striker Dominic Solanke from Chelsea to kick off their dealings ahead of 2017-18, with free agent Gael Clichy also linked.
Moore continued: "You can expect us to strengthen the team. There is money to back the manager and the sporting director.
"Hopefully we have got a long season of European football ahead of us and, as such, that squad needs to be built to be able to take that on accordingly, particularly with the style of football we play.
"We have deserved to get back and that is building a better platform for us to be more attractive to players. It's obviously worth money, and that's public, but we become more of an attractive club again.
"Players who want to play in Champions League - let's not forget this is a World Cup season at the end of next year and players want their national team managers to see them on the big stages."