Abstract
A bubble may be defined loosely as a sharp rise in price of an asset or a range of assets in a continuous process, with the initial rise generating expectations of further rises and attracting new buyers – generally speculators interested in profits from trading in the asset rather than its use or earning capacity. The rise is usually followed by a reversal of expectations and a sharp decline in price often resulting in financial crisis. A boom is a more extended and gentler rise in prices, production, and profits than a bubble and may be followed by crisis, sometimes taking the form of a crash (or panic) or alternatively by a gentle subsidence of the boom without crisis.
This is a preview of subscription content, log in via an institution.
Buying options
Tax calculation will be finalised at checkout
Purchases are for personal use only
Learn about institutional subscriptionsBibliography
Blanchard, O., and M.W. Watson. 1982. Bubbles, rational expectations and financial markets. In Crises in the economic and financial structure, ed. P. Wachtel. Lexington: Heath.
Flemming, J.S., R.W. Goldsmith, and J. Melitz. 1982. Comment. In Financial crises: Theory, history and policy, ed. C.P. Kindleberger and J.-P. Laffargue. Cambridge: Cambridge University Press.
Flood, R.P., and P.M. Garber. 1980. Market fundamentals versus price-level bubbles: The first tests. Journal of Political Economy 88: 745–770.
Kindleberger, C.P. 1978. Manias, panics and crashes: A history of financial crises. New York: Basic Books.
Minsky, H.P. 1982a. Can ‘it’ happen again?: Essays on instability and finance. Armonk: Sharpe.
Minsky, H.P. 1982b. The financial instability hypothesis. In Financial crises: Theory, history and policy, ed. C.P. Kindleberger and J.-P. Laffargue. Cambridge: Cambridge University Press.
Author information
Authors and Affiliations
Editor information
Copyright information
© 2018 Macmillan Publishers Ltd.
About this entry
Cite this entry
Kindleberger, C.P. (2018). Bubbles in History. In: The New Palgrave Dictionary of Economics. Palgrave Macmillan, London. https://doi.org/10.1057/978-1-349-95189-5_3073
Download citation
DOI: https://doi.org/10.1057/978-1-349-95189-5_3073
Published:
Publisher Name: Palgrave Macmillan, London
Print ISBN: 978-1-349-95188-8
Online ISBN: 978-1-349-95189-5
eBook Packages: Economics and FinanceReference Module Humanities and Social SciencesReference Module Business, Economics and Social Sciences