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Macroprudential Policies in a Global Perspective

  • Olivier Jeanne

This paper analyzes the case for the international coordination of macroprudential policies in the context of a simple theoretical framework. Both domestic macroprudential policies and prudential capital controls have international spillovers through their impact on capital flows. The uncoordinated use of macroprudential policies may lead to a "capital war" that depresses global interest rates. International coordination of macroprudential policies is not warranted, however, unless there is unemployment in some countries. There is scope for Pareto-improving international policy coordination when one part of the world is in a liquidity trap while the rest of the world accumulates reserves for prudential reasons.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 19967.

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Date of creation: Mar 2014
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Publication status: published as Jeanne, Olivier, 2013. "Macroprudential policies in a global perspective," Proceedings, Federal Reserve Bank of San Francisco, issue Nov, pages 1-38.
Handle: RePEc:nbr:nberwo:19967
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