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Credit growth and macroprudential policies: preliminary evidence on the firm level

In: Financial systems and the real economy

Author

Listed:
  • Meghana Ayyagari

    (George Washington University)

  • Thorsten Beck

    (Cass Business School, City, University of London, and CEPR)

  • Maria Soledad Martinez Peria

    (International Monetary Fund)

Abstract

Combining data on 1.3 million firms from 2002 to 2011 operating in 59 countries with changes in macroprudential regulations over this period, we find some evidence that macroprudential policies are associated with lower credit growth, especially for small firms with limited non-bank financing. We also find an impact of macroprudential policies on young firms in emerging markets. Our results point to an important tradeoff in financial stability and financial deepening.

Suggested Citation

  • Meghana Ayyagari & Thorsten Beck & Maria Soledad Martinez Peria, 2017. "Credit growth and macroprudential policies: preliminary evidence on the firm level," BIS Papers chapters,in: Bank for International Settlements (ed.), Financial systems and the real economy, volume 91, pages 15-34 Bank for International Settlements.
  • Handle: RePEc:bis:bisbpc:91-04
    as

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    File URL: http://www.bis.org/publ/bppdf/bispap91a.pdf
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    References listed on IDEAS

    as
    1. Christian Glocker & Pascal Towbin, 2012. "The Macroeconomic Effects of Reserve Requirements," WIFO Working Papers 420, WIFO.
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    3. International Monetary Fund, 2012. "Credit Growth and the Effectiveness of Reserve Requirements and Other Macroprudential Instruments in Latin America," IMF Working Papers 12/142, International Monetary Fund.
    4. Jérôme Vandenbussche & Ursula Vogel & Enrica Detragiache, 2015. "Macroprudential Policies and Housing Prices: A New Database and Empirical Evidence for Central, Eastern, and Southeastern Europe," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 47(S1), pages 343-377, March.
    5. Deniz O Igan & Heedon Kang, 2011. "Do Loan-To-Value and Debt-To-Income Limits Work? Evidence From Korea," IMF Working Papers 11/297, International Monetary Fund.
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    7. Hernando Vargas Herrera & Yanneth R Betancourt & Carlos Varela & Norberto Rodriguez, 2011. "Effects of reserve requirements in an inflation targeting regime: the case of Colombia," BIS Papers chapters,in: Bank for International Settlements (ed.), The global crisis and financial intermediation in emerging market economies, volume 54, pages 133-169 Bank for International Settlements.
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    11. Akinci, Ozge & Olmstead-Rumsey, Jane, 2015. "How Effective are Macroprudential Policies? An Empirical Investigation," International Finance Discussion Papers 1136, Board of Governors of the Federal Reserve System (U.S.).
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    Cited by:

    1. Mircea Epure & Irina Mihai & Camelia Minoiu & José-Luis Peydró, 2017. "Household Credit, Global Financial Cycle, and Macroprudential Policies: Credit Register Evidence from an Emerging Country," Working Papers 1006, Barcelona Graduate School of Economics.
    2. repec:bis:bisbpc:94-03 is not listed on IDEAS

    More about this item

    JEL classification:

    • E44 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Financial Markets and the Macroeconomy
    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies
    • G18 - Financial Economics - - General Financial Markets - - - Government Policy and Regulation
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation

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