Search Results

SORT BY: PREVIOUS / NEXT
Keywords:Dellas model 

Working Paper
Rational Bubbles in Non-Linear Business Cycle Models: Closed and Open Economies

This paper studies rational bubbles in non-linear dynamic general equilibrium models of the macroeconomy. The term ‘rational bubble’ refers to multiple equilibria due to the absence of a transversality condition (TVC) for capital. The lack of TVC can be due to an OLG population structure. If a TVC is imposed, the macro models considered here have a unique solution. Bubbles reflect self-fulfilling fluctuations in agents’ expectations about future investment. In contrast to explosive rational bubbles in linearized models (Blanchard (1979)), the rational bubbles in non-linear models here ...
Globalization Institute Working Papers , Paper 378

FILTER BY Bank

FILTER BY Content Type

FILTER BY Author

FILTER BY Jel Classification

C6 1 items

E1 1 items

E3 1 items

F3 1 items

F4 1 items

PREVIOUS / NEXT