Asset Bubbles, Endogenous Growth, and Financial Frictions. / Hirano, Tomohiro; Yanagawa, Noriyuki.

In: Review of Economic Studies, Vol. 84, No. 1, 01.2017, p. 406-443.

Research output: Contribution to journalArticlepeer-review

Published

Standard

Asset Bubbles, Endogenous Growth, and Financial Frictions. / Hirano, Tomohiro; Yanagawa, Noriyuki.

In: Review of Economic Studies, Vol. 84, No. 1, 01.2017, p. 406-443.

Research output: Contribution to journalArticlepeer-review

Harvard

Hirano, T & Yanagawa, N 2017, 'Asset Bubbles, Endogenous Growth, and Financial Frictions', Review of Economic Studies, vol. 84, no. 1, pp. 406-443. https://doi.org/10.1093/restud/rdw059

APA

Hirano, T., & Yanagawa, N. (2017). Asset Bubbles, Endogenous Growth, and Financial Frictions. Review of Economic Studies, 84(1), 406-443. https://doi.org/10.1093/restud/rdw059

Vancouver

Hirano T, Yanagawa N. Asset Bubbles, Endogenous Growth, and Financial Frictions. Review of Economic Studies. 2017 Jan;84(1):406-443. https://doi.org/10.1093/restud/rdw059

Author

Hirano, Tomohiro ; Yanagawa, Noriyuki. / Asset Bubbles, Endogenous Growth, and Financial Frictions. In: Review of Economic Studies. 2017 ; Vol. 84, No. 1. pp. 406-443.

BibTeX

@article{189c37729de144aeac0d380fe8a13d08,
title = "Asset Bubbles, Endogenous Growth, and Financial Frictions",
abstract = "This paper analyzes the existence and the effects of bubbles in an endogenous growth model with financial frictions and heterogeneous investments. Bubbles are likely to emerge when the degree of pledgeability is in the middle range. This implies that improving the financial market might enhance the possibility of bubbles. We also find that when the degree of pledgeability is relatively low, bubbles boost long-run growth. When it is relatively high, bubbles lower growth. Moreover, we examine the effects of bubbles bursting, and show that the effects depend on the degree of pledgeability, i.e., the quality of the financial system. Furthermore, we conduct a full welfare analysis of asset bubbles.",
author = "Tomohiro Hirano and Noriyuki Yanagawa",
year = "2017",
month = jan,
doi = "10.1093/restud/rdw059",
language = "English",
volume = "84",
pages = "406--443",
journal = "Review of Economic Studies",
issn = "0034-6527",
publisher = "Oxford University Press",
number = "1",

}

RIS

TY - JOUR

T1 - Asset Bubbles, Endogenous Growth, and Financial Frictions

AU - Hirano, Tomohiro

AU - Yanagawa, Noriyuki

PY - 2017/1

Y1 - 2017/1

N2 - This paper analyzes the existence and the effects of bubbles in an endogenous growth model with financial frictions and heterogeneous investments. Bubbles are likely to emerge when the degree of pledgeability is in the middle range. This implies that improving the financial market might enhance the possibility of bubbles. We also find that when the degree of pledgeability is relatively low, bubbles boost long-run growth. When it is relatively high, bubbles lower growth. Moreover, we examine the effects of bubbles bursting, and show that the effects depend on the degree of pledgeability, i.e., the quality of the financial system. Furthermore, we conduct a full welfare analysis of asset bubbles.

AB - This paper analyzes the existence and the effects of bubbles in an endogenous growth model with financial frictions and heterogeneous investments. Bubbles are likely to emerge when the degree of pledgeability is in the middle range. This implies that improving the financial market might enhance the possibility of bubbles. We also find that when the degree of pledgeability is relatively low, bubbles boost long-run growth. When it is relatively high, bubbles lower growth. Moreover, we examine the effects of bubbles bursting, and show that the effects depend on the degree of pledgeability, i.e., the quality of the financial system. Furthermore, we conduct a full welfare analysis of asset bubbles.

U2 - 10.1093/restud/rdw059

DO - 10.1093/restud/rdw059

M3 - Article

VL - 84

SP - 406

EP - 443

JO - Review of Economic Studies

JF - Review of Economic Studies

SN - 0034-6527

IS - 1

ER -