straightforward channels. The result is a macroeconomic model that allows for the endogenous development of stock price bubbles. Even … used to reduce volatility and distortion of the macroeconomic aggregates. -- Agent-based financial markets ; New Keynesian …

welfare and reduce the volatility of output and inflation, especially if asset price bubbles are caused by credit expansion …This paper studies whether and how the central bank should prick asset price bubbles, if the effect of interest rate … policy on bubbles can significantly vary across periods. For this purpose, I first construct a financial accelerator model …

financial crisis. The effect of bubbles on stock and housing markets and their transmission to the domestic real economy and the …

business cycles and stock price bubbles. We show that market sentiments exert important influence on the macroeconomy. They … introduce high volatility into impulse-response functions of macroeconomic variables and thus make the effect of a given shock …

(Monetary Policy and Asset Price Volatility, 1999, and Should Central Banks Respond to Movements in Asset Prices? 2001). The … output aggressive rule. -- New Keynesian models ; monetary policy ; stock markets and bubbles …

. -- New Keynesian models ; monetary policy ; stock markets and bubbles …

: (i) monetary volatility negatively affects long-run growth; (ii) the relation between nominal volatility and growth … increases the negative effect of nominal volatility on mean growth. …

(and rally) discrete jump distributions associated with positive (and negative) bubbles. The RE condition implies that the …