fiscal policy. - Bubbles ; financial accelerator ; credit constraints ; financial crisis ; pyramid schemes …

This paper uncovers a novel mechanism by which bubbles crowd in capital investment. If capital is initially depressed … by a binding credit constraint, injecting a bubble triggers a savings glut. Higher returns in a new bubbly equilibrium … channel is a robust phenomenon that occurs along the entire time path after bubbles are injected. …

This paper uncovers a novel mechanism by which bubbles crowd in capital investment. If capital is initially depressed … by a binding credit constraint, injecting a bubble triggers a savings glut. Higher returns in a new bubbly equilibrium … channel is a robust phenomenon that occurs along the entire time path after bubbles are injected. …

euro area as a whole and in its five largest countries. In a Bayesian VAR framework, the two credit supply shocks are … for business cycles. For the euro area, the explanatory power of the two credit supply shocks for GDP growth variations is …

proposed by Hasenzagl et al. (2018). We distinguish between price variables such as credit spreads and stock variables such as …

the emergence of rational bubbles in equilibrium. The model predicts that the dynamics of capital accumulation in … bubbles observed in the last decades. Our paper stresses this relative imbalance and links it to purely technological factors …, rational bubbles are not Pareto improving in our framework …