The Effects of Bubbles on the Asset Markets

In the first experiments we didn't expect the markets to work as well as they did. So what we learned was that you see people don't get into equilibrium in these asset markets just by thinking about it. They have to actually experience. And of course that's not very helpful out there in the world because you can't rerun the last 20 years two or three times so people understand what the consequences of a bubble layer are. But anyway this turned out to be just as the first exercise fueled a whole lot of studies and equilibrium convergence and markets for non-durables.

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