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Existing models of rational pure bubble models feature multiple (and often acontinuum of) equilibria, which makes model predictions and policy analysisnon-robust. We show that when the interest rate in the fundamental equilibriumis below the economic growth rate ($R<G$), a bubbly equilibrium with $R=G$exists. By injecting dividends that are vanishingly small relative to aggregateincome to the bubble asset, we can eliminate the fundamental steady state andresolve equilibrium indeterminacy. We show the general applicability ofdividend injection through examples in overlapping generations andinfinite-horizon models with or without production or financial frictions.

Unique Equilibria in Models of Rational Asset Price Bubbles