Effects of Macroprudential Policy: Evidence from Over 6,000 Estimates

54 Pages Posted: 12 Feb 2023

See all articles by Juliana Araujo

Juliana Araujo

International Monetary Fund (IMF)

Manasa Patnam

International Monetary Fund (IMF)

Adina Popescu

International Monetary Fund (IMF)

Fabian Valencia

affiliation not provided to SSRN

Weija Yao

International Monetary Fund (IMF)

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Abstract

This paper builds a novel database on the effects of macroprudential 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 iii) 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.

Suggested Citation

Araujo, Juliana and Patnam, Manasa and Popescu, Adina and Valencia, Fabian and Yao, Weija, Effects of Macroprudential Policy: Evidence from Over 6,000 Estimates. Available at SSRN: https://ssrn.com/abstract=4355491 or http://dx.doi.org/10.2139/ssrn.4355491

Juliana Araujo

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

Manasa Patnam

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

Adina Popescu

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

Fabian Valencia (Contact Author)

affiliation not provided to SSRN ( email )

No Address Available

Weija Yao

International Monetary Fund (IMF) ( email )

Kuwait

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