Work

An analysis of monetary and macroprudential policies in a DSGE model with reserve requirements and mortgage lending

Year: 2022

Type: article

Abstract: • Raising the reserve ratio leads to borrowers' welfare gains at the expense of savers. • Macroprudential policy stabilises the economy in response to a risk shock. • Macroprudential policy generates a stabilisation benefit to borrowers. • Macroprudential is more effective than monetary policy at stabilising against shocks. • Stabilisation works best when both monetary and macroprudential policy are used.

Source: Economic Modelling

DOI: 10.1016/j.econmod.2022.105966

Authors: Michael Ben-Gad, Joseph Pearlman, Ivy Sabuga

Institution: City, University of London

Language: English

Topic: Monetary Policy and Economic Impact

Subfield: General Economics, Econometrics and Finance

Field: Economics, Econometrics and Finance

Domain: Social Sciences

Open Access status: hybrid

Estimated APC paid: $2,220

Funder: European Commission