Credit Booms, Financial Crises and Macroprudential Policy
Mark Gertler (),
Nobuhiro Kiyotaki and
No 27481, NBER Working Papers from National Bureau of Economic Research, Inc
We develop a model of banking crises which Is consistent with two important features of the data: First, banking crises are usually preceded by credit booms. Second, credit booms often do not result in a crisis. That is, there are "good" booms as well as "bad" booms in the language of Gorton and Ordonez (2019). We then consider how the optimal macroprudential policy weighs the benefits of preventing a crisis against the costs of stopping a good boom. We show that countercyclical capital buffers are a critical feature of a successful macropudential policy.
JEL-codes: E00 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-ban, nep-dge and nep-mac
Note: CF EFG ME
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed
Published as Mark Gertler & Nobuhiro Kiyotaki & Andrea Prestipino, 2020. "Credit booms, financial crises, and macroprudential policy," Review of Economic Dynamics, vol 37, pages S8-S33.
Downloads: (external link)
Access to the full text is generally limited to series subscribers, however if the top level domain of the client browser is in a developing country or transition economy free access is provided. More information about subscriptions and free access is available at http://www.nber.org/wwphelp.html. Free access is also available to older working papers.
Journal Article: Credit Booms, Financial Crises, and Macroprudential Policy (2020)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:nbr:nberwo:27481
Ordering information: This working paper can be ordered from
The price is Paper copy available by mail.
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 ().