beyond other better-known early warning indicators, such as credit booms. This predictive power, however, only holds in … emerging economies. We show that governments in emerging economies are more concerned about their reputation and tend to ride … the short-term popularity benefits of weak credit booms rather than implementing politically costly corrective policies …

This paper analyzes the effects of several policy instruments to mitigate financial bubbles generated in the banking … policy instruments in counteracting financial bubbles. We find that an endogenous capital requirement reduces the impact of a …

This paper explores the link between monetary policies of large industrial countries and international credit cycles …. Based on an overinvestment framework, we show that in the prevailing asymmetric world monetary system, monetary policies of … large centre countries can fuel credit booms in emerging markets. We argue that the absorption of inflationary pressure by …

gradually decelerates. But sometimes the boom ends in twin currency and banking crises, and is followed by a protracted credit …