Browsing Faculté des arts et des sciences – Département de sciences économiques - Cahiers de recherche by Subject "Rational bubbles"
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(Université de Montréal. Département de sciences économiques., 2018-06)We develop a simple model of defaultable debt and rational bubbles in the price of an asset, which can be pledged as collateral in a competitive credit pool. When the asset pledgeability is low, the down payment is high, and bubble investment is ...