The recent literature on macroprudential policy contains several suggestions for possible instruments. This paper puts forward and implements a method for arriving at a coherent policy framework. It starts by defining the role of macroprudential policy in the overall policy framework for the...

The climate and biodiversity emergencies require structural economic shifts that will necessitate strategic coordination between macroeconomic policy authorities. The Covid-19 episode saw the implementation of monetary-fiscal policy coordination not seen since the 1970s to avert catastrophic...

Increases in firm default risk raise the default probability of banks while decreasing output and inflation in US data. To rationalize the empirical evidence, we analyse firm risk shocks in a New Keynesian model where entrepreneurs and banks engage in a loan contract and both are subject to...

Makroprudenzielle Politik hat das Ziel, die Stabilität des Finanzsystems zu überwachen und zu sichern. Systemrisiken entstehen, wenn Schieflagen in Teilen des Finanzsystems die Funktionsweise der Finanzmärkte und damit die realwirtschaftliche Entwicklung beeinträchtigen. Ziel dieser Politik...

This paper considers the interdependence of monetary and macroprudential policy in a New Keynesian business cycle model under the zero lower bound constraint. Entrepreneurs borrow in nominal terms from banks and are subject to idiosyncratic default risk. The realized loan return to the bank...

This paper studies the effect of bank competition on the optimal use of monetary and macroprudential policies. To this end, I develop a New Keynesian DSGE model with collateral constraints and an imperfect competitive banking sector. The results from the model demonstrate that the degree of...

Financial firm distress often leads to regulatory intervention, such as ldquo;too big to failrdquo; (TBTF) policies. Two oft-cited channels to justify TBTF are domino effects (counterparty risk) and the effects of fire sales. We analyze the policy responses for avoiding systemic risk while...

The purpose of this paper is to explore the impact of BRICS unions’ currency on the Dollar and its performances on international trade among the nations. The compound reviews of literature on the classical, neo classical and modern theories of trade reveals the non existence of research works...

The purpose of this paper is to explore the impact of BRICS unions’ currency on the Dollar and its performances on international trade among the nations. The compound reviews of literature on the classical, neo classical and modern theories of trade reveals the non existence of research works...