Principles for Macroprudential Regulation

10 Pages Posted: 1 Jul 2014

See all articles by Anil K. Kashyap

Anil K. Kashyap

University of Chicago, Booth School of Business; National Bureau of Economic Research (NBER); Federal Reserve Bank of Chicago

Dimitrios P. Tsomocos

University of Oxford - Said Business School and St. Edmund Hall

Alexandros Vardoulakis

Board of Governors of the Federal Reserve System

Date Written: June 30, 2014

Abstract

The drafting of macroprudential regulation is largely being driven by the need by policy makers to meet timetables that have been agreed. The legislative drive is taking place without any clear theoretical framework to organise the objectives. In this article we propose two principles that any satisfactory framework ought to respect and then describe one specific model that embodies these principles. We explain the insights from this approach for regulatory design.

Suggested Citation

Kashyap, Anil K. and Tsomocos, Dimitrios P. and Vardoulakis, Alexandros, Principles for Macroprudential Regulation (June 30, 2014). Chicago Booth Research Paper No. 14-19, Available at SSRN: https://ssrn.com/abstract=2460937 or http://dx.doi.org/10.2139/ssrn.2460937

Anil K. Kashyap (Contact Author)

University of Chicago, Booth School of Business ( email )

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Dimitrios P. Tsomocos

University of Oxford - Said Business School and St. Edmund Hall ( email )

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Alexandros Vardoulakis

Board of Governors of the Federal Reserve System ( email )

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Washington, DC 20551
United States

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