Asset Price Bubbles: A Selective Survey

 
Author/Editor: Scherbina, Anna
 
Publication Date: February 21, 2013
 
Electronic Access: Free Full text (PDF file size is 761KB).
Use the free Adobe Acrobat Reader to view this PDF file

 
Disclaimer: This Working Paper should not be reported as representing the views of the IMF. The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate
 
Summary: Why do asset price bubbles continue to appear in various markets? This paper provides an overview of recent literature on bubbles, with significant attention given to behavioral models and rational models with frictions. Unlike the standard rational models, the new literature is able to model the common characteristics of historical bubble episodes and offer insights for how bubbles are initiated and sustained, the reasons they burst, and why arbitrage forces do not routinely step in to squash them. The latest U.S. real estate bubble is described in the context of this literature.
 
Series: Working Paper No. 13/45
Subject(s): Asset prices | Business cycles | Investment | Economic models

 
English
Publication Date: February 21, 2013
ISBN/ISSN: 9781475515299/2227-8885 Format: Paper
Stock No: WPIEA2013045 Pages: 41
Price:
US$18.00 (Academic Rate:
US$18.00 )
 
 
Please address any questions about this title to publications@imf.org