Monetary Versus Macroprudential Policies: Causal Impacts of Interest Rates and Credit Controls in the Era of the UK Radcliffe Report

David Aikman (), Oliver Bush and Alan Taylor

No 22380, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We have a world of conjoined monetary and macroprudential policies. But can they function smoothly and with what effects? The evidence is quite limited, especially for advanced economies. We adopt a historical laboratory. From the 1950s to the 1980s, the UK used credit policy tools alongside conventional interest rate policy. These tools are similar to today’s macroprudential policies. We document these tools and craft a new dataset to estimate their effects using modern high-frequency identification with a novel empirical strategy, Factor-Augmented Local Projection. Monetary policy acted mainly on inflation but credit policy acted primarily to modulate bank lending.

JEL-codes: E50 G18 N14 (search for similar items in EconPapers)
Date: 2016-06
New Economics Papers: this item is included in nep-cba and nep-mac
Note: DAE ME
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (28)

Downloads: (external link)
http://www.nber.org/papers/w22380.pdf (application/pdf)

Related works:
Working Paper: Monetary versus macroprudential policies causal impacts of interest rates and credit controls in the era of the UK Radcliffe Report (2016)
Working Paper: Monetary versus macroprudential policies:causal impacts of interest rates andcredit controls in the era of the UKradcliffe report (2016)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:nbr:nberwo:22380

Ordering information: This working paper can be ordered from
http://www.nber.org/papers/w22380

Access Statistics for this paper

More papers in NBER Working Papers from National Bureau of Economic Research, Inc National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.. Contact information at EDIRC.
Bibliographic data for series maintained by ().