Long-lived collateralized assets and bubbles

When infinite lived agents trade long-lived assets secured by durable goods, equilibrium exists without any uniform impatience requirements or additional debt constraints. Asset pricing bubbles are absent when the new endowments of durable goods are uniformly bounded away from zero. Otherwise, bubbles may occur, even for assets in persistently positive net supply and for deflators that yield finite present values of aggregate wealth.

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Year of publication:	2007-03
Authors:	Araujo, Aloisio ; Pascoa, Mario Rui ; Torres-Martinez, Juan Pablo
Institutions:	Departamento de Economia, Pontifícia Universidade Católica do Rio de Janeiro
Subject:	Existence of equilibrium \| Asset pricing bubbles \| Collateralized assets

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Extent:	application/pdf
Series:	Textos para discussão.
Type of publication:	Book / Working Paper
Language:	English
Notes:	Number 542 30 pages long
Classification:	D50 - General Equilibrium and Disequilibrium. General ; D52 - Incomplete Markets
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005744645