The impact of macroprudential policies on industrial growth

Carlos Madeira

No 1191, BIS Working Papers from Bank for International Settlements

Abstract: This paper analyses the causal impact of macroprudential policies on growth, using industry-level data for 89 countries for the period 1990 to 2021. The small industry size creates an exogenous identification and avoids reverse-causality. I find that macroprudential tightening measures have a negative impact on manufacturing growth, but only for industries with high external finance dependence. This effect is stronger during banking crises, periods of higher output growth and for advanced economies. The effect is weaker during period of high private credit growth. Growth effects on externally dependent industries are economically sizeable and can persist over three years.

Keywords: macroprudential policy; financial development; growth; external finance dependence; credit frictions (search for similar items in EconPapers)
JEL-codes: E44 G28 O10 O16 (search for similar items in EconPapers)
Date: 2024-05
New Economics Papers: this item is included in nep-ban, nep-cba and nep-fdg
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Related works:
Journal Article: The impact of macroprudential policies on industrial growth (2024)
Working Paper: The impact of macroprudential policies on industrial growth (2023)
Working Paper: The impact of macroprudential policies on industrial growth (2020)
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Persistent link: https://EconPapers.repec.org/RePEc:bis:biswps:1191

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