@article {Jarrow37, author = {Robert Jarrow}, title = {Asset Price Bubbles and the Land of Oz}, volume = {42}, number = {2}, pages = {37--42}, year = {2016}, doi = {10.3905/jpm.2016.42.2.037}, publisher = {Institutional Investor Journals Umbrella}, abstract = {The conventional view in the professional finance community is that we live in a world with only rare asset price bubbles of immense magnitude. Instead, in this article the author argues that price bubbles are a common phenomenon, and that most stocks have small price bubbles representing perhaps 1\% to 25\% of their value. The theoretical underpinnings for this argument are based on the local martingale theory of bubbles and a recent article by the author where he derives a multiple-factor asset-pricing model with asset price bubbles. In this article, the author reviews the previous piece and uses it to support his assertion.TOPICS: Analysis of individual factors/risk premia, theory}, issn = {0095-4918}, URL = {https://jpm.pm-research.com/content/42/2/37}, eprint = {https://jpm.pm-research.com/content/42/2/37.full.pdf}, journal = {The Journal of Portfolio Management} }