Macroprudential Policies, Economic Growth and Banking Crises

Mohamed Belkhir, Sami Ben Naceur, Bertrand Candelon and Jean-Charles Wijnandts

No 2022010, LIDAM Discussion Papers LFIN from Université catholique de Louvain, Louvain Finance (LFIN)

Abstract: Using a sample covering emerging market and advanced economies, we assess the impact of macroprudential policies on financial stability. 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 macroprudential policies (MPPs) exert a direct stabilizing effect, they also have an indirect destabilizing effect, which works through the depressing of economic growth. It turns out that mitigating effects of MPPs on the likelihood of banking crises is more pronounced in emerging market economies relative to advanced economies.

Keywords: Macroprudential Policies; Banking Crises; Economic Growth (search for similar items in EconPapers)
JEL-codes: C33 G01 G18 (search for similar items in EconPapers)
Pages: 56
Date: 2022-01-01
New Economics Papers: this item is included in nep-cba
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Citations: View citations in EconPapers (14)

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Related works:
Journal Article: Macroprudential policies, economic growth and banking crises (2022)
Working Paper: Macroprudential policies, economic growth and banking crises (2022)
Working Paper: Macroprudential Policies, Economic Growth, and Banking Crises (2020)
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