Does macroprudential policy affect wealth inequality? Evidence from synthetic controls

André Teixeira

Journal of Financial Stability, 2023, vol. 67, issue C

Abstract: This paper examines the effects of macroprudential policy (MaPP) on wealth inequality using a large dataset of 171 countries. I find that, after the adoption of MaPP, wealth concentration in the treated countries increases by 3.4 percentage points in a decade. This finding is explained by a rise in the wealth share of the top 1% combined with a sharp decline in the wealth share of the bottom 50%. These effects are stronger for prudential rules based on income, particularly in advanced economies.

Keywords: Bank regulation; Macroprudential policy; Inequality; Wealth; Synthetic controls (search for similar items in EconPapers)
JEL-codes: E21 E52 E58 G28 O47 (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (4)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finsta:v:67:y:2023:i:c:s1572308923000359

DOI: 10.1016/j.jfs.2023.101135

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