This folder contains the data and code to reproduce results in the paper ``Asset Bubbles and Foreign Interest Rate Shocks''.

The softwares used are Matlab R2020a, Dynare 4.5.6 and Stata 15.1.

The code was run on Windows 10 on a desktop with Intel i9-10900K CPU @3.70GHz and 128 GB RAM. 

(i) Folder "Stock Mkt Capitalization Average":    
(1) run cal_stock_cap_average.m to calculate the average of stock market capitalization in percent of GDP for emerging markets and developed economies; 
(2) run plot_stock_cap_average.m to reproduce Figure 1
Expected computation time: Less than one second.


(ii) Folder "Stock Mkt Business Cycle":    run run_stock_mkt_business_cycle to reproduce Table 1
Expected computation time: Less than one second.


(iii) Folder "EME PanelVAR":                     
(1) run run_panel_var.do in subfolder "Stata_code_file" to generate the source data for var irfs from panel data
Expected computation time: Less than 6 hours.
(2) run plot_panel_var_eme.m to reproduce Figures 2
Expected computation time: Less than one second. 


(iv) Folder "Estimation Bubbly":           run run_est_bubbly.m to reproduce Table 3 (upper panel)
Expected computation time: Less than 40 min. 


(v) Folder "Estimation Bubbleless":        run run_est_bubbleless.m to reproduce Table 3 (lower panel)
Expected computation time: About 4 hours.


(vi) Folder "Simulation":                  run run_all.m to reproduce Figure 3-5, Table 4-7
Expected computation time: About one minute.


(vii) Folder "IRF Comparison"                    
(1) run run_data_Mexico in subfolder "Stata_code_file" to generate the source data for var irfs from Mexican data
(2) run run_var.m to reproduce Figure 6
Expected computation time: About one minute.