Macroprudential Policy in Asian Economies
Kim, Soyoung | April 2019
Abstract
This paper analyzes the conduct and effects of macroprudential policy in 11 Asian economies. Of these, India, the People’s Republic of China, and the Republic of Korea frequently used loan-to-value ratios and required reserve ratios even before the global financial crisis. India and the People’s Republic of China are the most frequent users of macroprudential policy tools. Since 2000, tightening actions have been more frequent than loosening in the 11 economies. Most took tightening actions more frequently after the global financial crisis than before it. In most of these economies, macroprudential policy tends to be tightened when credit expands. The main empirical results from the analysis, which uses panel vector autoregression models, are that contractionary macroprudential policy has significant negative effects on credit and output; and that these effects are qualitatively similar to those of monetary policy. This suggests that policy authorities may experience potential policy conflicts when credit conditions are excessive and the economy is in recession.
Citation
Kim, Soyoung. 2019. Macroprudential Policy in Asian Economies. © Asian Development Bank. http://hdl.handle.net/11540/10072. License: CC BY 3.0 IGO.ISSN
2313-6537 (print)
2313-6545 (electronic)
Keywords
Development
Finance
Development Challenges
Development Issues
Development Problems
Microenterprises Finance
Commercial Finance Companies
Enterprise Financing
Financial Analysis
Banking Finance And Investment
SMEs
Small Business Finance
Rural planning
Aid coordination
Industrial projects
Infrastructure projects
Natural resources policy
Educational development
Development strategy
Development models
Economic development
ADB
Project finance
Development plans
Strategic planning
Business Financing
Investment Requirements
Insurance Companies
International Monetary Relations
International Financial Market
Exchange Rate
Credit Policy
Credit Cooperatives
Financing
Financial System
Financial Sector Reform
Financial Institution
Bank Financing
Financial Sector Development
Infrastructure Development
Insurers
Insurance stocks
Insurance holding companies
Insurance carriers
Insurance agencies
Business subsidies
Investment companies
Foreign investment
Equity Finance
International banks and banking
Stock exchanges
Grants
Loans
Communication in rural development
Communication in community development
Economic development projects
Development banks
Economic forecasting
Environmental auditing
Cumulative effects assessment
Human rights and globalization
Small business
Credit allocation
Credit control
Development credit corporations
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