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Comparative assessment of macroprudential policies

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  • Bruno, Valentina
  • Shim, Ilhyock
  • Shin, Hyun Song

Abstract

This paper provides a comparative assessment of the effectiveness of macroprudential policies in 12 Asia-Pacific economies over 2004–2013, using databases of domestic macroprudential policies and capital flow management (CFM) policies. We find that banking sector CFM policies and bond market CFM policies are effective in slowing down banking inflows and bond inflows, respectively. We also find some evidence of spillover effects of these policies. Finally, regarding the interaction of monetary policy and macroprudential policies, our empirical findings suggest that macroprudential policies are more successful when they complement monetary policy by reinforcing monetary tightening, than when they act in opposite directions.

Suggested Citation

  • Bruno, Valentina & Shim, Ilhyock & Shin, Hyun Song, 2017. "Comparative assessment of macroprudential policies," Journal of Financial Stability, Elsevier, vol. 28(C), pages 183-202.
    • Handle: RePEc:eee:finsta:v:28:y:2017:i:c:p:183-202
    DOI: 10.1016/j.jfs.2016.04.001
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    Keywords

    Macroprudential policy; Capital flow management policy; Interest rate policy; Complementarity; Asia-Pacific;
    All these keywords.

    JEL classification:

    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation

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