FUNDING EXTERNALITIES, ASSET PRICES AND INVESTORS' 'SEARCH FOR YIELD' |
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| Authors: | Prasanna Gai, Kamakshya Trivedi&dagger |
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| Affiliation: | Australian National University, Australia;, and Goldman Sachs International, London, UK |
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| Abstract: | This note presents a simple model that nests the 'excess liquidity' and 'savings glut' hypotheses of the debate on the recent asset price boom. It clarifies the notion of investors' 'search for yield' and shows how financial frictions influence asset price dynamics. |
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| Keywords: | search for yield funding externalities |
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