TY - BOOK ID - 138285546 TI - Reserve Requirements in the Brave New Macroprudential World AU - Cordella, Tito AU - Geller, Michael S. AU - Park, Ji Won PY - 2014 SN - 1464802130 PB - Washington, D.C., The World Bank, DB - UniCat KW - Money supply. KW - Monetary policy. KW - Capital movements. KW - Foreign exchange rates. KW - Business cycles. UR - https://www.unicat.be/uniCat?func=search&query=sysid:138285546 AB - Using a new, large data set on quarterly reserve requirements for the period 1970-2011, this paper provides new evidence on the use of reserve requirements as a countercyclical macroprudential tool in developing countries. The appeal of reserve requirements lies in the pro-cyclical behavior of the exchange rate over the business cycle in developing countries. This enormously complicates the use of interest rates as a countercyclical instrument (because of its effect on the exchange rate) and calls for a second instrument. The paper suggests that conflicts may arise between the microprudential and macroprudential policy stances. ER -