introduced in the first volume to a more technical level. Where volume I provided an introduction to the mathematics of bubbles …Chapter1 Asset price dynamics and stochastic processes -- Chapter2 Stylized facts of financial markets and bubbles … -- Chapter3 Introduction to contagions and bubbles -- Chapter4 Rational Social Learning -- Chapter5 Bubbles -- Chapter6 …

supporting the resale option theory of bubbles: investors overpay for a warrant hoping to resell it at an even higher price to a …

debt is equivalent to the allocations that are sustained with unbacked public debt or rational bubbles; for the latter …

2000), and that they might be in a better position to react to long-lived bubbles than many market participants. However …

We develop a stylized model of economic growth with bubbles. In this model, financial frictions lead to equilibrium … dispersion in the rates of return to investment. During bubbly episodes, unproductive investors demand bubbles while productive … dynamically inefficient: otherwise, there would be no demand for bubbles. This dynamic inefficiency, however, might be generated …

Economists broadly define financial asset price bubbles as episodes in which prices rise with notable rapidity and … attempted to study and interpret bubbles through the prisms of rational expectations, efficient markets, and equilibrium … that explains how and why bubbles (and crashes) evolve and can also be defined, measured, and compared. This book develops …