Bubbles, Crises, and Policy
From IFORS Developing Countries Online Resources
In many recent cases financial-liberalization has led to a bubble in asset prices. The bursting of the bubble results in a banking crisis and recession. It is suggested such bubbles are caused by an interaction of the risk-shifting problem arising from agency relationships in intermediaries and uncertainty concerning the expansion of credit.
Link to material: http://finance.wharton.upenn.edu/~allenf/download/Vita/bubbles.pdf
