Bubbles and total factor productivity
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Published version
Date
2012-05-01
Authors
Miao, Jianjun
Wang, Pengfei
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OA Version
Citation
J. Miao, P. Wang. 2012. "Bubbles and Total Factor Productivity" The American Economic Review, Volume 102, Issue 3, pp.82-87. https://doi.org/10.1257/aer.102.3.82
Abstract
This paper presents an infinite-horizon model of production economies in which firms face idiosyncratic productivity shocks and are subject to endogenous credit constraints. Credit-driven stock price bubbles can arise which can relax credit constraints and reallocate capital more efficiently among firms. The collapse of bubbles causes a fall of total factor productivity.
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