Temporary bubbles.
type: Item
instance of: scholarly article
title: Temporary bubbles.
zbMATH Open document ID: 1071.91030
DOI: 10.1016/S0022-0531(03)00063-2
author: Bertrand Wigniolle
author: Philippe Michel
published in: Journal of Economic Theory
publication date: 2003-10-15T00:00:00Z
review text: The paper is devoted to the analysis of monetary phenomena. The problem is studied in the form of an overlapping generations model with capital accumulation. It is supposed that the agents live two periods. Budget and cash-in-advance constraints are formulated. Two basic cases are examined: the liquidity constraint is binding (Hahn and Solow's regime named HS) or not for the generation. In the HS-regime the existence of an intertemporal equilibrium under some conditions is proved. In the second case, it is proved that there exists an intertemporal equilibrium and the corresponding dynamics of the variable \(k_t=K_t/N_t,\) where \(K_t\) is the capital stock and \(N_t\) being a number of young agents, monotonically converges towards the golden rule. The question, whether an economy can switch from one regime to another along an equilibrium trajectory, is investigated. It is stated that money can periodically support bubbles, but the bubbles are temporary. Different types of equilibria may exist.
reviewed by: Elena Ya. Gorelova
Mathematics Subject Classification ID: 91B52
Mathematics Subject Classification ID: 37N40
Mathematics Subject Classification ID: 39A11
Mathematics Subject Classification ID: 91B54
zbMATH DE Number: 1993338
zbMATH Keywords: mathematical model of monetary phenomena
zbMATH Keywords: overlapping generations model
zbMATH Keywords: bubbles
MaRDI profile type: Publication
cites work: Monetary, Fiscal, and Reserve Requirement Policy in a Simple Monetary Growth Model
cites work: Capital market imperfections in a monetary growth model
cites work: Money, banks and endogenous volatility
cites work: Financial market frictions, monetary policy, and capital accumulation in a small open economy
cites work: The Effects of Open Market Operations in a Model of Intermediation and Growth
cites work: Asset Bubbles and Overlapping Generations
full work available at URL: s0022-0531(03)00063-2
OpenAlex ID: W4236715437
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description: scientific article; zbMATH DE number 1993338