bubbles tend to appear and expand in countries where productivity is low relative to the rest of the world. These bubbles …This paper presents a stylized model of international trade and asset price bubbles. Its central insight is that … productivity countries. Through this channel, bubbles act as substitute for international capital flows, improving the …

producing sector, when fiscal rules generate sustained fiscal surpluses, when the rest of the world has lower expansion …. The latter is more likely if bubbles develop along the expansionary path. These (rational) bubbles can emerge even when …

correlations are lower than predicted by the standard risk-sharing implications of these models. In this paper, I use regression … tiny fraction of the variation in tradeables consumption across countries. Furthermore, risk-sharing in tradeables is … rejected. Second, I examine the effects of capital market restrictions on aggregate consumption risk-sharing by countries …

secular stagnation and to study policy externalities across countries. We find capital flows transmit recessions in a world …

accounts for the interaction between temperature, economic growth and risk. The model simultaneously matches the projected … temperature path, the observed consumption growth dynamics, discount rates provided by the risk-free rate and equity market …

would optimally diversify away domestic output risk. Therefore, in a world without investor home bias, consumption growth … portfolio theory would suggest. This phenomenon has been called equity home bias.' In the absence of this home bias, investors … country appears to be highly correlated with its own output growth relative to the world. This phenomenon may be called …

International risk-sharing has far-reaching implications both for economic policy and for basic research in economics …. When countries do not share risk, individuals in those countries experience fluctuations in their consumption levels that … are undesirable and possibly unnecessary. This paper extends and refines the study of international risk-sharing in two …