Financial Innovation and Asset Price Volatility
比较了不完全市场和完全市场下代际交叠模型中的资产价格，发现金融创新使不同信念的个体能够对赌，导致财富分配变化，从而引发资产价格大幅波动。
We compare asset prices in an overlapping generations model for incomplete and complete markets. Individuals within a generational cohort have heterogeneous beliefs about future states of the economy and thus would like to make bets against each other. In the incomplete-markets economy, agents cannot make such bets. Asset price volatility is very small. The situation changes dramatically when markets are completed through financial innovations as the set of available securities now allows agents with different beliefs to place bets against each other. Wealth shifts across agents and generations. Such changes in the wealth distribution lead to substantial asset price volatility.