Financial Crises in DSGE Models : Selected Applications of MAPMOD /

This paper, together with a technical companion paper, presents MAPMOD, a new IMF model designed to study vulnerabilities associated with excessive credit expansions, and to support macroprudential policy analysis. In MAPMOD, bank loans create purchasing power that facilitates adjustments in the rea...

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Autor principal: Benes, Jaromir
Altres autors: Kumhof, Michael, Laxton, Douglas
Format: Revista
Idioma:English
Publicat: Washington, D.C. : International Monetary Fund, 2014.
Col·lecció:IMF Working Papers; Working Paper ; No. 2014/056
Accés en línia:Full text available on IMF
Descripció
Sumari:This paper, together with a technical companion paper, presents MAPMOD, a new IMF model designed to study vulnerabilities associated with excessive credit expansions, and to support macroprudential policy analysis. In MAPMOD, bank loans create purchasing power that facilitates adjustments in the real economy. But excessively large and risky loans can impair balance sheets and sow the seeds of a financial crisis. Banks respond to losses through higher spreads and rapid credit cutbacks, with adverse effects for the real economy. These features allow the model to capture the basic facts of both the pre-crisis and crisis phases of financial cycles.
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Descripció física:1 online resource (55 pages)
Format:Mode of access: Internet
ISSN:1018-5941
Accés:Electronic access restricted to authorized BRAC University faculty, staff and students