Major bubble episodes are rare events. In this paper, we examine what factors might cause some asset price bubbles to …

We provide a theory to investigate the implications of time-varying bailout policy for rational bubbles in an infinite …-horizon production economy. In particular, we ask two questions. First, should the government bail out asset bubbles? Second, if yes, how … bubbles are vulnerable to market sentiment and resource-consuming. The systematic risk of bubble bursting causes both asset …

As long as bubble size is relatively small, bubbles increase production level, but once the size becomes too large …, then bubbles reduce it. Given this non-monotonic relationship, this paper investigates the relationship between bubbles and … government bailouts. It shows that bailouts for bursting bubbles may positively influence ex-ante production efficiency and relax …

Major bubble episodes are rare events. In this paper, we examine what factors might cause some asset price bubbles to …

Major bubble episodes are rare events. In this paper, we examine what factors might cause some asset price bubbles to …

We develop a model of rational bubbles based on the assumptions of unknown market liquidity and limited liability of … condition for whether rational bubbles are possible. Based on this analysis, we discuss several widely-discussed policy measures … with respect to their effectiveness in preventing bubbles. A reduction of manager bonuses or a Tobin tax can create or …

reflects very well the financial market crises and pricing bubbles over the past 20 years. …