A Welfare Analysis of Macroprudential Policy Rules in the Euro Area

Jean-Christophe Poutineau () and Gauthier Vermandel
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Jean-Christophe Poutineau: CREM - Centre de recherche en économie et management - UNICAEN - Université de Caen Normandie - NU - Normandie Université - UR - Université de Rennes - CNRS - Centre National de la Recherche Scientifique

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Abstract: In an estimated DSGE model of the European Monetary Union that accounts for financial differences between core and peripheral countries, we find that country-adjusted macroprudential measures lead to significant welfare gains with respect to a uniform macroprudential policy rule that reacts to union wide financial developments. However, peripheral countries are the winners from the implementation of macroprudential measures while core countries incur welfare losses, thus questioning the interest of adopting coordinated macroprudential measures with peripheral countries.

Keywords: Bayesian Estimation; Euro Area; Financial Accelerator; Macroprudential policy; DSGE Two-Country Model (search for similar items in EconPapers)
Date: 2017
New Economics Papers: this item is included in nep-ban, nep-cba, nep-dge, nep-eec, nep-mac, nep-mon, nep-opm and nep-sog
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Citations: View citations in EconPapers (2)

Published in Revue d'économie politique, 2017, 127 (2), pp.191-226. ⟨10.3917/redp.272.0191⟩

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Journal Article: A Welfare Analysis of Macroprudential Policy Rules in the Euro Area (2017)
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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:halshs-01315085

DOI: 10.3917/redp.272.0191

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