Work

Macroprudential Supervision: From Theory to Policy

Year: 2016

Type: article

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.

Source: National Institute Economic Review

DOI: 10.1177/002795011623500115

Authors: Dirk Schoenmaker, Peter Wierts

Institutions: Bruegel, Erasmus University Rotterdam, Vrije Universiteit Amsterdam, De Nederlandsche Bank

Language: English

Topic: Banking stability, regulation, efficiency

Subfield: Finance

Field: Economics, Econometrics and Finance

Domain: Social Sciences

Open Access status: green

OpenAlex ID: W3023715642

FWCI: 3.119

Cites: 63

Cited by: 17

Related to: 10