Effects of Macroprudential Policy: Evidence from Over 6,000 Estimates
IMF Working Paper WP/20/67
47 Pages Posted: 24 Jun 2020
Date Written: June 2, 2020
This paper builds a novel database on the effects of macro-prudential policy drawing from 58 empirical studies, comprising over 6,000 results on a wide range of instruments and outcome variables. It encompasses information on statistical significance, standardized magnitudes, and other characteristics of the estimates. Using meta-analysis techniques, the paper estimates average effects to find:
i) statistically significant effects on credit, but with considerable heterogeneity across instruments;
ii) weaker and more imprecise effects on house prices;
iii) quantitatively stronger effects in emerging markets and among studies using micro-level data; and
iv) statistically significant evidence of leakages and spillovers.
Other findings include relatively stronger impacts for tightening than loosening actions and negative effects on economic activity in the near term.
Keywords: Macroprudential Policy, Financial Stability, Meta-Analysis
JEL Classification: E28, G28
Suggested Citation: Suggested Citation