Asset Bubbles in a Monopolistically Competitive Macro Model

I look at the existence of asset bubbles in a monopolistically competitive dynamic macroeconomic model. The positive predictions of te model are very similar to Tirole's competitive model. But the welfare effects are very different - in that as capital gets crowded out, welfare falls. The monopolistically competitive sector contracts and the wage rate falls, lowering welfare.

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Year of publication:	1997-10
Authors:	Sen, Partha
Institutions:	Centre for Research into Industry, Enterprise, Finance and the Firm (CRIEFF), University of St. Andrews
Subject:	Monopolistic competition \| bubble equilibrium \| dynamic efficiency

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Series:	CRIEFF Discussion Papers.
Type of publication:	Book / Working Paper
Classification:	D9 - Intertemporal Choice and Growth ; E1 - General Aggregative Models ; O41 - One, Two, and Multisector Growth Models
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005698021