We develop a tractable rational bubbles model with financial frictions, downward nominal wage rigidity, and the zero lower bound. The interaction of financial frictions and nominal rigidities leads to a "bubbly pecuniary externality," where competitive speculation in risky bubbly assets can...

We extend prior research examining the relation between aggregate recommendation changes and future returns by documenting that this relation varies over time as a function of the predictability of future earnings growth. When industry-level earnings growth is more predictable, we find that...

This research paper has analyzed the spillover of BSE stock returns by the regime ofmacroeconomic variables. The study selected sample macroeconomic indicators such as FII, IFT,M3, Production Index and WPI from the period of 1-01-2010 to 31.12.2019 from the RBI websiteand www.bseindia.com. The...

Through extending a standard Grossman and Stiglitz (1980) noisy rational expectations economy by a heterogeneous signal structure with signal-specific differences in uncertainty, we show that price momentum as well as reversal are not intrinsically at odds with rational behavior. Differences in...