Distinguished Speaker Series: Bubbly Financial Globalization | Asian Development Bank

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Distinguished Speaker Series: Bubbly Financial Globalization

Event | 1 February 2019 ADBI, Tokyo, Japan
Speaker Details

Speaker: Giacomo Rondina
Affiliation: University of California, San Diego
Time: 14:30–15:30


Has the recent surge in financial globalization made the world economy more prone to widespread episodes of asset price bubbles? This Distinguished Scholar Seminar will feature Professor Giacomo Rondina who addresses this question by developing a stylized global equilibrium model of two production economies with diverse financial development—North and South.

In autarky, the financially mature North produces enough assets to prevent bubbles from occurring.

In the financially undeveloped South, bubbles can potentially offset the shortage of financial assets, but the limited leverage potential of productive entrepreneurs makes the required return on the bubble unsustainable. When financial globalization takes place, bubbles become possible if two conditions are met: the financial development of the South is increased and globalized financial markets display a shortage of asset supply for intermediated saving.

The author argues that both conditions seem to have gradually emerged over that last twenty years.

About the Speaker

Giacomo Rondina is an Associate Teaching Professor in the Department of Economics at the University of California, San Diego, and Associate Editor of the European Economic Review. He obtained his PhD from the University of Wisconsin, Madison in 2007. His research interests include macroeconomic theory, international macroeconomics, and higher education pedagogy. His current work focuses on information aggregation, financial globalization, rational bubbles, and online learning technology.

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