{
  "title": "Procyclical Behavior of Institutional Investors During the Recent Financial Crisis: Causes, Impacts, and Challenges",
  "publication": "IMF Working Papers, September 11, 2013",
  "sourceUrl": "https://www.imf.org/en/publications/wp/issues/2016/12/31/procyclical-behavior-of-institutional-investors-during-the-recent-financial-crisis-causes-40939",
  "canonical": "https://www.imf.org/en/publications/wp/issues/2016/12/31/procyclical-behavior-of-institutional-investors-during-the-recent-financial-crisis-causes-40939",
  "overlayPath": "/en/publications/wp/issues/2016/12/31/procyclical-behavior-of-institutional-investors-during-the-recent-financial-crisis-causes-40939/index.md",
  "summary": "This paper (i) provides evidence on the procyclical investment behavior of major institutional investors during the global financial crisis; (ii) identifies the main factors that could account for such behavior; (iii) discusses the implications of procyclical behavior; and (iv) proposes a framework",
  "sections": [
    {
      "heading": "Summary and main conclusion",
      "content": "- This paper (i) provides evidence on the procyclical investment behavior of major institutional investors during the global financial crisis; (ii) identifies the main factors that could account for such behavior; (iii) discusses the implications of procyclical behavior; and (iv) proposes a framework for sound investment practices for long-term investors.\n- Such procyclical investment behavior is understandable and may be considered rational from an individual institution’s perspective.\n- Main conclusion: behaving in a manner consistent with longterm investing would lead to better long-term, risk-adjusted returns and, importantly, could lessen the potential adverse effects of the procyclical investment behavior of institutional investors on global financial stability."
    },
    {
      "heading": "Evidence on procyclical behavior",
      "content": "- Presents evidence on the procyclical investment behavior of major institutional investors during the global financial crisis."
    },
    {
      "heading": "Factors accounting for procyclicality",
      "content": "- Identifies the main factors that could account for procyclical investment behavior (text lists factors broadly; original paper develops these factors in detail)."
    },
    {
      "heading": "Implications and impacts",
      "content": "- Discusses the implications of procyclical behavior for institutions and for global financial stability.\n- Highlights potential adverse effects of institutional investors’ procyclical behavior on global financial stability."
    },
    {
      "heading": "Framework and policy recommendations for long-term investors",
      "content": "- Proposes a framework for sound investment practices for long-term investors.\n- Policy implication emphasized: behaving consistently with longterm investing can improve long-term, risk-adjusted returns and reduce systemic adverse effects.\n\n---\n\n Content in this bundle\n\n- PDP-Working Paper\n  - PDP-Working Paper (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - PDP-Working Paper (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2016/12/31/procyclical-behavior-of-institutional-investors-during-the-recent-financial-crisis-causes-40939"
    }
  ],
  "bullets": [
    "[Markdown version](/en/publications/wp/issues/2016/12/31/procyclical-behavior-of-institutional-investors-during-the-recent-financial-crisis-causes-40939/index.md)",
    "[Structured JSON version](/en/publications/wp/issues/2016/12/31/procyclical-behavior-of-institutional-investors-during-the-recent-financial-crisis-causes-40939/index.json)",
    "[Bundle manifest](/en/publications/wp/issues/2016/12/31/procyclical-behavior-of-institutional-investors-during-the-recent-financial-crisis-causes-40939/bundle-manifest.json)",
    "Authors: Michael G. Papaioannou, Joonkyu Park, Jukka Pihlman, Han van der Hoorn",
    "Published: September 11, 2013",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9781484336083.001",
    "This paper (i) provides evidence on the procyclical investment behavior of major institutional investors during the global financial crisis; (ii) identifies the main factors that could account for such behavior; (iii) discusses the implications of procyclical behavior; and (iv) proposes a framework for sound investment practices for long-term investors.",
    "Such procyclical investment behavior is understandable and may be considered rational from an individual institution’s perspective.",
    "Main conclusion: behaving in a manner consistent with longterm investing would lead to better long-term, risk-adjusted returns and, importantly, could lessen the potential adverse effects of the procyclical investment behavior of institutional investors on global financial stability.",
    "Presents evidence on the procyclical investment behavior of major institutional investors during the global financial crisis.",
    "Identifies the main factors that could account for procyclical investment behavior (text lists factors broadly; original paper develops these factors in detail).",
    "Discusses the implications of procyclical behavior for institutions and for global financial stability.",
    "Highlights potential adverse effects of institutional investors’ procyclical behavior on global financial stability.",
    "Proposes a framework for sound investment practices for long-term investors.",
    "Policy implication emphasized: behaving consistently with longterm investing can improve long-term, risk-adjusted returns and reduce systemic adverse effects.",
    "**PDP-Working Paper**"
  ],
  "related": [
    {
      "title": "PDP-Working Paper",
      "role": "document",
      "sourceUrl": "https://www.imf.org/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/wp/2013/_wp13193.pdf",
      "summary": {
        "path": "/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/wp/2013/_wp13193.pdf.md",
        "mime": "text/markdown"
      },
      "binary": {
        "path": "/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/wp/2013/_wp13193.pdf",
        "mime": "application/pdf"
      }
    }
  ],
  "alternates": {
    "markdown": "/en/publications/wp/issues/2016/12/31/procyclical-behavior-of-institutional-investors-during-the-recent-financial-crisis-causes-40939/index.md",
    "json": "/en/publications/wp/issues/2016/12/31/procyclical-behavior-of-institutional-investors-during-the-recent-financial-crisis-causes-40939/index.json",
    "bundleManifest": "/en/publications/wp/issues/2016/12/31/procyclical-behavior-of-institutional-investors-during-the-recent-financial-crisis-causes-40939/bundle-manifest.json"
  },
  "generatedAtUtc": "2026-09-18T04:07:06.086Z"
}