Macroeconomic Costs of Higher Bank Capital and Liquidity Requirements

Author/Editor:

Scott Roger ; Jan Vlcek

Publication Date:

May 1, 2011

Electronic Access:

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Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary:

This paper uses a DSGE model with banks and financial frictions in credit markets to assess the medium-term macroeconomic costs of increasing capital and liquidity requirements. The analysis indicates that the macroeconomic costs of such measures are sensitive to the length of the implementation period as well as to the adjustment strategy used by banks, and the scope for monetary policy to respond to the regulatory changes.

Series:

Working Paper No. 11/103

English

Publication Date:

May 1, 2011

ISBN/ISSN:

9781455260386/1018-5941

Stock No:

WPIEA2011103

Price:

$18.00 (Academic Rate:$18.00)

Format:

Paper

Pages:

51

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