Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/226841
Authors: 
Schularick, Moritz
ter Steege, Lucas
Ward, Felix
Year of Publication: 
2020
Series/Report no.: 
ECONtribute Discussion Paper No. 041
Abstract: 
Can central banks defuse rising stability risks in financial booms by leaning against the wind with higher interest rates? This paper studies the state-dependent effects of monetary policy on financial crisis risk. Based on the near-universe of advanced economy gonancial cycles since the 19th century, we show that discretionary leaning against the wind policies during credit and asset price booms are more likely to trigger crises than prevent them.
Subjects: 
financial stability
monetary policy
local projections
JEL: 
E44
E50
G01
G15
N10
Document Type: 
Working Paper

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