Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/193509
Authors: 
Schoenmaker, Dirk
Wierts, Peter
Year of Publication: 
2016
Series/Report no.: 
ESRB Working Paper Series 2
Abstract: 
Financial supervision focuses on the aggregate (macroprudential) in addition to the individual (microprudential). But an agreed framework for measuring and addressing financial imbalances is lacking. We propose a holistic approach for the financial system as a whole, beyond banking. Building on our model of financial amplification, the financial cycle is the key variable for measuring financial imbalances. The cycle can be curbed by leverage restrictions that might vary across countries. We make concrete policy proposals for the design of macroprudential instruments to simplify the current framework and make it more consistent.
Subjects: 
financial cycle
macroprudential policy
financial supervision
leverage ratio
JEL: 
E44
G01
G28
Persistent Identifier of the first edition: 
ISBN: 
978-92-95081-29-1
Document Type: 
Working Paper
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