BIS Working Papers – Dampening global financial shocks: can macroprudential regulation help (more than capital controls)?
Author(s):Katharina Bergant, Francesco Grigoli, Niels-Jakob Hansen and Damiano Sandri Date:May 2023 Abstract: We show that macroprudential regulation significantly dampens the impact of global financial shocks on emerging markets. Specifically, a tighter level of regulation reduces the sensitivity of GDP growth to capital flow shocks and movements in the VIX. A broad set of macroprudential tools[…]