Dr. Heiner Mikosch - Seminar Presentation

Prof. Pui-Sun Tam

Date and Time: May 20th, 2016, 3:00 - 4:30 pm

Room: A 101 in the Economics Building (Museum)

Abstract

Rajan (2010) points to rising income inequality as a root cause of the recent financial crisis through high household leverage. However, some empirical studies conclude that crises bear no relation to inequality.

To clarify this controversy,we reexamine the issue by using the same data as in the literature, but establish a result different from the previous conclusion after taking into account the role of asset bubbles.Our regression is based on a new theoretical model that is supported by certain key stylized facts, with all techniques of analysis we use indicating the significance of the inequality-leverage-crisis nexus.

About the Spekaer

Prof. Pui-Sun Tam is an Associate Professor of Business Economics at the University of Macao. She received her PhD from the Chinese University of Hong Kong.