Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

Sector-specific macroprudential regulations increase the riskiness of credit to other sectors. Using firm-level data, this paper computed the measures of the riskiness of corporate credit allocation for 29 advanced and emerging economies. Consistently across these measures, the paper finds that during credit expansions, an unexpected tightening of household-specific macroprudential tools is followed by a rise in riskier corporate lending. Quantitatively, such unexpected tightening during a period of rapid credit growth increases the riskiness of corporate credit by around 10 percent of the historical standard deviation. This result supports early policy interventions when credit vulnerabilities are still low, since sectoral leakages will be less important at this stage. Further evidence from bank lending standards surveys suggests that the leakage effects are stronger for larger firms compared to SMEs, consistent with recent evidence on the use of personal real estate as loan collateral by small firms.

Denmark --- Macroeconomics. --- Financial institutions --- Corporate debt. --- Government policy. --- Denmark. --- Economics: General. --- Money and Monetary Policy. --- Corporate Finance. --- Foreign Exchange. --- Informal Economy. --- Underground Econom. --- Monetary Policy, Central Banking, and the Supply of Money and Credit: General. --- Financial Markets and the Macroeconomy. --- Corporate Finance and Governance: General. --- Economic & financial crises & disasters. --- Economics of specific sectors. --- Monetary economics. --- Ownership & organization of enterprises. --- Credit. --- Money. --- Macroprudential policy. --- Financial sector policy and analysis. --- Bank credit. --- Macroprudential policy instruments. --- Corporate sector. --- Economic sectors. --- Currency crises. --- Informal sector. --- Economics. --- Economic policy. --- Business enterprises. --- Bank credit --- Business enterprises --- Corporate Finance and Governance: General --- Corporate Finance --- Corporate sector --- Credit --- Currency crises --- Economic & financial crises & disasters --- Economic policy --- Economic sectors --- Economics of specific sectors --- Economics --- Economics: General --- Financial Markets and the Macroeconomy --- Financial sector policy and analysis --- Foreign Exchange --- Informal Economy --- Informal sector --- Macroeconomics --- Macroprudential policy instruments --- Macroprudential policy --- Monetary economics --- Monetary Policy, Central Banking, and the Supply of Money and Credit: General --- Money and Monetary Policy --- Money --- Ownership & organization of enterprises --- Underground Econom

Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

This paper provides an analysis of the use and effects of capital controls in 27 AEs and EMDEs which experienced at least one financial crisis between 1995 and 2017. Countries often turn to using capital controls in crisis: some ease inflow controls while others tighten controls on outflows. A key finding is that countries with pervasive controls before the start of the crisis are shielded compared to countries with more open capital accounts, which see a significant decline in capital flows during crises. In contrast, the effectiveness of capital controls introduced during crises appears to be weak and difficult to identify. There is also some evidence that the introduction of outflow controls during crises is negatively associated with sovereign debt ratings, but that investors may actually forgive with time.

Macroeconomics --- Economics: General --- Exports and Imports --- Financial Risk Management --- Current Account Adjustment --- Short-term Capital Movements --- Financial Crises --- Financial Institutions and Services: Government Policy and Regulation --- International Investment --- Long-term Capital Movements --- Economic & financial crises & disasters --- Economics of specific sectors --- International economics --- Capital controls --- Balance of payments --- Capital outflows --- Financial crises --- Capital account --- Capital flows --- Currency crises --- Informal sector --- Economics --- Capital movements --- United States

Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

This paper provides an analysis of the use and effects of capital controls in 27 AEs and EMDEs which experienced at least one financial crisis between 1995 and 2017. Countries often turn to using capital controls in crisis: some ease inflow controls while others tighten controls on outflows. A key finding is that countries with pervasive controls before the start of the crisis are shielded compared to countries with more open capital accounts, which see a significant decline in capital flows during crises. In contrast, the effectiveness of capital controls introduced during crises appears to be weak and difficult to identify. There is also some evidence that the introduction of outflow controls during crises is negatively associated with sovereign debt ratings, but that investors may actually forgive with time.

United States --- Macroeconomics --- Economics: General --- Exports and Imports --- Financial Risk Management --- Current Account Adjustment --- Short-term Capital Movements --- Financial Crises --- Financial Institutions and Services: Government Policy and Regulation --- International Investment --- Long-term Capital Movements --- Economic & financial crises & disasters --- Economics of specific sectors --- International economics --- Capital controls --- Balance of payments --- Capital outflows --- Financial crises --- Capital account --- Capital flows --- Currency crises --- Informal sector --- Economics --- Capital movements