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Evolution is shaping the world around us. At the core of every evolutionary process is a population of reproducing individuals. The outcome of an evolutionary process depends on population structure. Here we provide a general formula for calculating evolutionary dynamics in a wide class of structured populations. This class includes the recently introduced(More)
A model in which homebuyers make a modest approximation leads house prices to display three features present in the data but usually missing from rational models: momentum at one-year horizons, mean reversion at five-year horizons, and excess longer-term volatility relative to fundamentals. Approximating buyers assume that past prices reflect only(More)
This paper incorporates speculation into the standard supply-and-demand framework used to analyze housing booms and busts. Speculation reverses the common intuition that elastic housing supply attenuates housing booms. Housing market frictions make land a more attractive speculative investment than housing. As a result, undeveloped land both facilitates(More)
We present a dynamic theory of prices and volume in asset bubbles. In our framework, predictable price increases endogenously attract short-term investors more strongly than long-term investors. Short-term investors amplify volume by selling more frequently, and they destabilize prices through positive feedback. Our model predicts a lead–lag relationship(More)
We present an extrapolative model of bubbles. In the model, many investors form their demand for a risky asset by weighing two signals—an average of the asset's past price changes and the asset's degree of overvaluation. The two signals are in conflict, and investors " waver " over time in the relative weight they put on them. The model predicts that good(More)
What is the impact of taxation in matching markets? In matching markets, because agents have heterogeneous preferences over potential partners, welfare depends on which agents are matched to each other in equilibrium. Taxes in matching markets can generate inefficiency by changing who is matched to whom, even if the number of workers at each firm is(More)
We calibrate a dynamic model of housing in the spatial equilibrium tradition of Rosen and Roback to see whether such a model can fit the key empirical moments of the housing market such as the volatility and serial correlation of price changes and new construction. With reasonable parameter values, the model generates the empirically observed mean reversion(More)
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