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Replication data for: Optimal Monetary and Prudential Policies

Version
1
Resource Type
Dataset
Creator
  • Collard, Fabrice
  • Dellas, Harris
  • Diba, Behzad
  • Loisel, Olivier
Publication Date
2017-01-01
Description
  • Abstract

    The recent financial crisis has highlighted the interconnectedness between macroeconomic and financial stability, raising questions about how to combine monetary and prudential policies. This paper characterizes the jointly optimal monetary and prudential policies, setting the interest rate and bank-capital requirements. The source of financial fragility is the socially excessive risk taking by banks due to limited liability and deposit insurance. We provide conditions under which locally (Ramsey) optimal policy dedicates the prudential instrument to preventing inefficient risk taking by banks, and the monetary instrument to dealing with the business cycle, with the two instruments covarying either negatively, or positively and countercyclically.
Availability
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Relations
  • Is supplemented by
    DOI: 10.1257/mac.20140139 (Text)
Publications
  • Collard, Fabrice, Harris Dellas, Behzad Diba, and Olivier Loisel. “Optimal Monetary and Prudential Policies.” American Economic Journal: Macroeconomics 9, no. 1 (January 2017): 40–87. https://doi.org/10.1257/mac.20140139.
    • ID: 10.1257/mac.20140139 (DOI)

Update Metadata: 2019-10-13 | Issue Number: 1 | Registration Date: 2019-10-13

Collard, Fabrice; Dellas, Harris; Diba, Behzad; Loisel, Olivier (2017): Replication data for: Optimal Monetary and Prudential Policies. Version: 1. ICPSR - Interuniversity Consortium for Political and Social Research. Dataset. http://doi.org/10.3886/E114097V1