How Complementary Are Prudential Regulation and Monetary Policy?

• Tác giả: Otaviano Canuto
• Ngôn ngữ: eng
• Ký hiệu phân loại: 332.46 Monetary policy
• Thông tin xuất bản: World Bank, Washington, DC, 2012
• Bộ sưu tập: Tài liệu truy cập mở
• ID: 243877
• Chủ đề: 1. ACCUMULATION OF RESERVES; 2. AGGREGATE DEMAND; 3. ARBITRAGE; 4. ASSET PRICE; 5. ASSET PRICE BOOMS

Tóm tắt

Could either monetary policy or financial prudential regulation be relied on individually to mitigate asset price cycles or their effects? If both ways are effective, monetary policy and prudential regulation could then be considered 'substitutes,' in the sense that the individual use of either instrument leads to a reduction in the volatility of both corresponding targets. This note, however, argues in favor of complementarily rather than substitution in the use of monetary and macro-prudential policies: the combined (articulate) use of both policies tends to be more effective than a standalone implementation of either.