Bubbles, Financial Crises, and Systemic Risk∗
نویسندگان
چکیده
This chapter surveys the literature on bubbles, financial crises, and systemic risk. The first part of the chapter provides a brief historical account of bubbles and financial crisis. The second part of the chapter gives a structured overview of the literature on financial bubbles. The third part of the chapter discusses the literatures on financial crises and systemic risk, with particular emphasis on amplification and propagation mechanisms during financial crises, and the measurement of systemic risk. Finally, we point toward some questions for future
منابع مشابه
Bubbles, Crises, and Heterogeneous Beliefs
This chapter reviews the quickly growing literature that builds on heterogeneous beliefs, a widely observed attribute of individuals, to explain bubbles, crises, and endogenous risk in financial markets. * This chapter is prepared for Handbook for Systemic Risk edited by Jean-Pierre Fouque and Joe Langsam. I thank Hersh Shefrin for helpful editorial suggestions.
متن کاملBubbles and Crises
In recent ®nancial crises a bubble, in which asset prices rise, is followed by a collapse and widespread default. Bubbles are caused by agency relationships in the banking sector. Investors use money borrowed from banks to invest in risky assets, which are relatively attractive because investors can avoid losses in low payoff states by defaulting on the loan. This risk shifting leads investors ...
متن کاملBubbles and Total Factor Productivity
Evidence shows that asset price bubbles typically precede financial crises and financial crises are accompanied by the collapse of bubbles. In addition, stock market booms and busts are typically associated with credit market booms and busts. The recent US housing and stock market bubbles and the subsequent Great Recession that began in late 2007 provide an example. The stock market booms in th...
متن کاملAn Overview on the Literature and History of Systemic Banking Crisis in Iran and Around the World
Often, systemic banking crises initiate from one or more banks and affect countries by rapid spreading in the banking network, financial markets and economy of countries. According to Reinhart & Rogoff (2009) in the book titled "This time is Different," financial crises are pointed as an equal opportunity menace for high-income countries and emerging markets. Although The International Mo...
متن کاملNber Working Paper Series Real Estate Bubbles and Urban Development
Why are real estate bubbles so common? Can these bubbles actually do some good? Real estate booms have regularly occurred throughout the world leaving painful busts and financial crises in their wake. This paper suggests that real estate is a natural investment for more passive debt investors, including banks, because real estate’s flexibility makes it better collateral than specifically built ...
متن کامل