Coordination Effects and Optimal Policy Choices of Macroprudential Policy and Monetary Policy
Joint Authors
Source
Issue
Vol. 2020, Issue 2020 (31 Dec. 2020), pp.1-11, 11 p.
Publisher
Hindawi Publishing Corporation
Publication Date
2020-12-14
Country of Publication
Egypt
No. of Pages
11
Main Subjects
Abstract EN
Considering three monetary policy rules, together with two endogenous macroprudential policies that are credit constraints (loan to value, LTV) for households and counter-cyclical capital (capital requirement ratio, CRR) for bankers, this paper establishes a dynamic stochastic general equilibrium (DSGE) model.
Based on the welfare analysis of different combinations of macroprudential rules and monetary policy rules, this paper identifies the optimal policy combinations and analyzes the coordination effects between macroprudential policies and monetary policies.
The results show that no matter what kind of monetary policy rules is implemented, the introduction of macroprudential rules has improved the level of total social welfare.
In the optimal “two pillars” framework of monetary policies and macroprudential rules, the main objective of monetary policy is to stabilize price inflation, and the macroprudential policy to be implemented is the CRR macroprudential policy.
This combination can effectively promote the stability of the real estate market, financial market, and macroeconomy, while maximizing the improvement of total social welfare.
American Psychological Association (APA)
Pan, Haifeng& Zhang, Dingsheng. 2020. Coordination Effects and Optimal Policy Choices of Macroprudential Policy and Monetary Policy. Complexity،Vol. 2020, no. 2020, pp.1-11.
https://search.emarefa.net/detail/BIM-1145835
Modern Language Association (MLA)
Pan, Haifeng& Zhang, Dingsheng. Coordination Effects and Optimal Policy Choices of Macroprudential Policy and Monetary Policy. Complexity No. 2020 (2020), pp.1-11.
https://search.emarefa.net/detail/BIM-1145835
American Medical Association (AMA)
Pan, Haifeng& Zhang, Dingsheng. Coordination Effects and Optimal Policy Choices of Macroprudential Policy and Monetary Policy. Complexity. 2020. Vol. 2020, no. 2020, pp.1-11.
https://search.emarefa.net/detail/BIM-1145835
Data Type
Journal Articles
Language
English
Notes
Includes bibliographical references
Record ID
BIM-1145835