What Do We Know About the Effects of Macroprudential Policy?

29 Pages Posted: 27 Sep 2014

See all articles by Gabriele Galati

Gabriele Galati

De Nederlandsche Bank

Richhild Moessner

Bank for International Settlements (BIS)

Multiple version iconThere are 2 versions of this paper

Date Written: September 25, 2014

Abstract

The literature on the effectiveness of macroprudential policy tools is still in its infancy and has so far provided only limited guidance for policy decisions. In recent years, however, increasing efforts have been made to fill this gap. Progress has been made in embedding macroprudential policy in theoretical models. There is increasing empirical work on the effect of some macroprudential tools on a range of target variables, such as quantities and prices of credit, asset prices, and on the amplitude of the financial cycle and financial stability. In this paper we review recent progress in theoretical and empirical research on the effectiveness of macroprudential instruments.

Keywords: Macroprudential policy, financial regulation

JEL Classification: E58, G28

Suggested Citation

Galati, Gabriele and Moessner, Richhild, What Do We Know About the Effects of Macroprudential Policy? (September 25, 2014). De Nederlandsche Bank Working Paper No. 440. Available at SSRN: https://ssrn.com/abstract=2502003 or http://dx.doi.org/10.2139/ssrn.2502003

Gabriele Galati (Contact Author)

De Nederlandsche Bank ( email )

PO Box 98
1000 AB Amsterdam
Amsterdam, 1000 AB
Netherlands

Richhild Moessner

Bank for International Settlements (BIS) ( email )

Centralbahnplatz 2
Basel, Basel-Stadt 4002
Switzerland

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