This paper describes how behavioral elements are relevant to financial supervision,regulation, and central banking. It …

system of capital regulation that addresses these needs by making changes to all three pillars of bank regulation: only …

financial tranquility always call for more stringent regulation over time? We examine this question using a simple portfolio … optimal regulation/macroprudential policy. Our paper implies that policymakers should not only consider the cyclical …

, the market equilibrium may not be optimal and there is a need for prudential regulation. We show that the optimal capital …

We show that macroprudential regulation can considerably dampen the impact of globalfinancial shocks on emerging … markets. More specifically, a tighter level of regulation reducesthe sensitivity of GDP growth to VIX movements and capital … andliquidity, foreign currency mismatches, and risky forms of credit. We also find that tightermacroprudential regulation allows …