Financial bubbles and capital accumulation in altruistic economies

Bosi, Stefano and Ha-Huy, Thai and Le Van, Cuong and Pham, Cao-Tung and Pham, Ngoc-Sang (2018): Financial bubbles and capital accumulation in altruistic economies.

Abstract

We consider an overlapping generations model à la Diamond (1965) with two additional ingredients: altruism and an asset (or land) bringing non-stationary positive dividends (or fruits). We study the global dynamics of capital stocks and asset values as well as the interplay between them. Asset price bubbles are also investigated.

• Item Type: MPRA Paper
• Language: English
• Keywords: Forward altruism, overlapping generations, capital accumulation, financial asset, positive dividends, rational bubbles
• Subjects: C - Mathematical and Quantitative Methods > C6 - Mathematical Methods ; Programming Models ; Mathematical and Simulation Modeling > C62 - Existence and Stability Conditions of Equilibrium; D - Microeconomics > D5 - General Equilibrium and Disequilibrium > D50 - General; D - Microeconomics > D5 - General Equilibrium and Disequilibrium > D53 - Financial Markets; D - Microeconomics > D6 - Welfare Economics > D64 - Altruism ; Philanthropy; E - Macroeconomics and Monetary Economics > E2 - Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy > E21 - Consumption ; Saving ; Wealth; E - Macroeconomics and Monetary Economics > E4 - Money and Interest Rates > E44 - Financial Markets and the Macroeconomy; G - Financial Economics > G1 - General Financial Markets > G12 - Asset Pricing ; Trading Volume ; Bond Interest Rates

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