Please use this identifier to cite or link to this item: https://hdl.handle.net/20.500.11851/10989
Title: Effectiveness of Macroprudential Policies on Credit Surge and Stop Episodes
Authors: Ekinci, Mehmet Fatih
Kenc, Turalay
Tamgaç Tezcan, Ünay
Keywords: Macroprudential policy
Capital flows
Credit surges
Credit stops
E58
E61
F34
F41
G18
Panel-Data
Capital Flows
Countries
Matters
Cycles
Booms
Bias
Issue Date: 2024
Publisher: Springer
Abstract: When faced with capital flow and credit growth waves in recent years, policymakers have relied upon macroprudential regulation. This paper sheds light on a relatively less-analyzed policy issue: how macroprudential regulatory measures mitigate extreme credit growth episodes. We use a dynamic panel data approach to estimate the impact of MaPPs on credit growth volatility and the likelihood of credit growth boom and bust episodes. We find that MaPPs reduce credit growth volatility in both advanced economies (AEs) and emerging market economies (EMEs). In addition, MaPPs help to prevent credit surges in EMEs and stops in AEs. Our results show that there is a strong link between net capital flows and credit growth stop episodes. Net capital flow surges trigger a credit surge for EMEs. This suggests that policymakers should consider both MaPPs and capital flow management measures when designing policies to mitigate the risks associated with these phenomena.
URI: https://doi.org/10.1007/s11079-023-09744-3
https://hdl.handle.net/20.500.11851/10989
ISSN: 0923-7992
1573-708X
Appears in Collections:Scopus İndeksli Yayınlar Koleksiyonu / Scopus Indexed Publications Collection
WoS İndeksli Yayınlar Koleksiyonu / WoS Indexed Publications Collection

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