Digging Deeper : Evidence on the Effects of Macroprudential Policies from a New Database /

This paper introduces a new comprehensive database of macroprudential policies, which combines information from various sources and covers 134 countries from January 1990 to December 2016. Using these data, we first confirm that loan-targeted instruments have a significant impact on household credit...

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Bibliographic Details
Main Author: Alam, Zohair
Other Authors: Alter, Adrian, Eiseman, Jesse, Gelos, R.
Format: Journal
Language:English
Published: Washington, D.C. : International Monetary Fund, 2019.
Series:IMF Working Papers; Working Paper ; No. 2019/066
Online Access:Full text available on IMF
Description
Summary:This paper introduces a new comprehensive database of macroprudential policies, which combines information from various sources and covers 134 countries from January 1990 to December 2016. Using these data, we first confirm that loan-targeted instruments have a significant impact on household credit, and a milder, dampening effect on consumption. Next, we exploit novel numerical information on loan-to-value (LTV) limits using a propensity-score-based method to address endogeneity concerns. The results point to economically significant and nonlinear effects, with a declining impact for larger tightening measures. Moreover, the initial LTV level appears to matter; when LTV limits are already tight, the effects of additional tightening on credit is dampened while those on consumption are strengthened.
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Physical Description:1 online resource (57 pages)
Format:Mode of access: Internet
ISSN:1018-5941
Access:Electronic access restricted to authorized BRAC University faculty, staff and students