Macroprudential Policy and Credit Supply

Macroprudential Policy and Credit Supply

Blog Article

Summary In this paper we analyze financial crises and the interactions of macroprudential policy and credit.Financial crises Gift Cards are recurrent systemic phenomena, often triggering deep and long-lasting recessions with large reductions in aggregate welfare, output and employment Importantly for policy, systemic financial crises are typically not random events triggered by exogenous events, but they tend to occur after periods of rapid, strong Faber TWEET EG8 BK A55 55cm Wall Chimney Cooker Hood Extractor 330.0572.387 credit growth.Moreover, a credit crunch tends to follow in a financial crisis with negative aggregate real effects Macroprudential policy softens the credit supply cycles, with important positive effects on the aggregate real economy in crisis times.