Macroprudential Policies in a Global Perspective

Olivier Jeanne

No 9875, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: 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.

Keywords: Capital controls; Capital flows; International policy coordination; International reserves; Liquidity trap; Macroprudential policy (search for similar items in EconPapers)
JEL-codes: F36 F41 F42 (search for similar items in EconPapers)
Date: 2014-03
New Economics Papers: this item is included in nep-cba and nep-opm
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Citations: View citations in EconPapers (46)

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Related works:
Working Paper: Macroprudential Policies in a Global Perspective (2014)
Working Paper: Macroprudential Policies in a Global Perspective (2014)
Journal Article: Macroprudential policies in a global perspective (2013)
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