Skip to main content Accessibility help
×
Home
  • Access
  • Print publication year: 2020
  • Online publication date: August 2020

Chapter 1 - The Bubble Triangle

  • View HTML
    • Send chapter to Kindle

      To send this chapter to your Kindle, first ensure no-reply@cambridge.org is added to your Approved Personal Document E-mail List under your Personal Document Settings on the Manage Your Content and Devices page of your Amazon account. Then enter the ‘name’ part of your Kindle email address below. Find out more about sending to your Kindle.

      Note you can select to send to either the @free.kindle.com or @kindle.com variations. ‘@free.kindle.com’ emails are free but can only be sent to your device when it is connected to wi-fi. ‘@kindle.com’ emails can be delivered even when you are not connected to wi-fi, but note that service fees apply.

      Find out more about the Kindle Personal Document Service.

      Available formats
      ×

      Send chapter to Dropbox

      To send content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about sending content to Dropbox.

      Available formats
      ×

      Send chapter to Google Drive

      To send content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about sending content to Google Drive.

      Available formats
      ×

Summary

Chapter 1 explains why the study of bubbles is important. Bubbles can have huge economic, social and political costs, but some bubbles may be useful. The chapter discusses the origin of the ‘bubble’ metaphor and the definition of a bubble. It then develops a new metaphor and framework for bubbles based on the chemistry of fire - the bubble triangle - in order to better understand their causes and consequences. The three sides of the bubble triangle are marketability, credit and money, and speculation – these correspond to oxygen, fuel and heat in the fire triangle. The spark which sets the bubble fire alight is either technological change or a government policy decision. This analytical framework helps predict when bubbles will occur, when they will burn out and what their economic effects will be. The chapter concludes by outlining the catalogue of 12 historical bubbles that will be examined in the rest of the book.

Related content

Powered by UNSILO