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Macroprudential supervision: From theory to policy

Dirk Schoenmaker () and Peter Wierts

No 2, ESRB Working Paper Series from European Systemic Risk Board

Abstract: Financial supervision focuses on the aggregate (macroprudential) in addition to the individual (microprudential). But an agreed framework for measuring and addressing financial imbalances is lacking. We propose a holistic approach for the financial system as a whole, beyond banking. Building on our model of financial amplification, the financial cycle is the key variable for measuring financial imbalances. The cycle can be curbed by leverage restrictions that might vary across countries. We make concrete policy proposals for the design of macroprudential instruments to simplify the current framework and make it more consistent. JEL Classification: E44, G01, G28

Keywords: financial cycle; macroprudential policy; financial supervision; leverage ratio (search for similar items in EconPapers)
Date: 2016-02
New Economics Papers: this item is included in nep-ban and nep-mac
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Related works:
Journal Article: Macroprudential Supervision: From Theory to Policy (2016) Downloads
Working Paper: Macroprudential supervision- from theory to policy (2015) Downloads
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Persistent link: https://EconPapers.repec.org/RePEc:srk:srkwps:201602

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