Bubbles are recurrent events, which contribute to both macroeconomic and employment volatility. We introduce stochastic … bubbles in the standard search-and matching model of the labor market. The economy alternates between latent and bubbly states …, each being associated with a distinct solution for the market value of firms (respectively, stable or explosive). Bubbles …

We study the macroeconomic effects of rational asset bubbles in an overlapping-generations economy where asset trading … are large, the private gains associated with trading asset bubbles may lead too many workers to become speculators …, thereby causing rational bubbles to lose their efficiency properties. Moreover, if speculation can be carried out by skilled …

norm, but it is likely to be punctuated with episodes of bubbles and crashes. The paper also considers if market …

asset market bubbles occur in all sessions, but global markets had significantly more extreme and longer duration valuation … bubbles. Additionally, subjects at the most suboptimal times-of-day held significantly more asset shares in their portfolios …

shocks depends on financial conditions. Our model allows us to change the response of the US financial markets to volatility …

volatility of both inflation and unemployment differentials. Finally, we show that it is important to take into account the … and real wage rigidities. In our analysis, we focus on the differentials in inflation and unemployment between countries … inflation and unemployment differentials. Second, we find that asymmetries in labor market structures tend to increase the …