Lansing, Kevin J. (contributor) - 2008
trend growth, reminiscent of the U.S. economy during the late 1920s and late 1990s.
The welfare cost of speculation … (relative to rational behavior) depends crucially on parame-
ter values. Speculation can improve welfare if risk aversion is low … speculation is large, typically exceeding one percent of per-period consumption.
Keywords: Endogenous Growth, Business Cycles …