Macroprudential policies, economic growth, and banking crises [electronic resource] / by Mohamed Belkhir, Sami Ben Naceur, Bertrand Candelon, and Jean-Charles Wijnandts.

[Washington, D.C.] : International Monetary Fund, 2020.©2020

Belkhir, Mohamed. author.

Naceur, Sami Ben. author.

Candelon, Bertrand. author.

Wijnandts, Jean-Charles. author.

International Monetary Fund. issuing body.

01-01-2020

1 online resource (52 pages).

text

online resource

IMF working paper ; no. 20/65

IMF working paper ; no. 20/65.

WEB (Copy 1) INTRANET 1257717-1001 ONLINE

Open item 

Macroeconomic policy

Economic development

Financial crises

Economic models

Overseas item

Statistics

"March 2020"

Includes bibliographical references.

9781513536989

Using a sample that covers more than 100 countries over the 2000-2017 period, we assess the impact of macroprudential policies on financial stability. In particular, we examine whether the activation of macroprudential policies is conducive to a lower incidence of systemic banking crises. Our empirical setup is designed to account for the potential direct and indirect effects that macroprudential policies can have on banking crises. We find that while macro-prudential policies exert a direct stabilizing effect, they also have an indirect destabilizing effect, which works through the depressing of economic growth. A Generalized Impulse Response Function analysis of a dynamic system composed of the probability of a banking crisis and economic growth reveals, however, that macroprudential policies have a positive net effect on financial stability (lower likelihood of systemic banking crises).

1257717

1257717-1001

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