The author summarizes what economic theory tells us about when asset price bubbles can occur and what the welfare implications are from bursting them. In some cases, bursting a bubble may make society worse off by exacerbating the market distortions that give rise to the bubble in the first place.Asset-liability management ; Asset pricing

Gadi Barlevy

English

Research Papers in Economics

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Economic theory and asset bubbles

http://www.chicagofed.org/digital_assets/publications/economic_perspectives/2007/ep_3qtr2007_part3_Barlevy.pdf

Economic theory and asset bubbles

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Research Papers in Economics