Arce, Oscar; López-Salido, J David - C.E.P.R. Discussion Papers - 2008
the conditions under which housing bubbles can emerge. In such equilibria, the total housing stock is held by owners that … constraints is more prone to bubbles which, in turn, tend to have a larger size but are less fragile in face of fund …-draining shocks. Our environment also allows for pure bubbles on useless assets. We find that multiple equilibria in which the economy …