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Brexit and macroprudential regulation: a DSGE perspective

Author

Listed:
  • Jürgen Jerger

    (University of Regensburg
    Leibniz Institute for East and Southeast European Studies)

  • Jenny Körner

    (European Central Bank)

Abstract

This paper uses a small and simple theoretical DSGE model in order to conduct some exercises in comparative dynamics of shocks that can be associated with Brexit. We do so by comparing two policy environments, one where a flexible macroprudential regulation (FMR) is in place and one, where this is not the case. This enables us to evaluate whether and to what extent FMR helps to mitigate the Brexit related shocks. We conclude that FMR would indeed be helpful, although in quantitative terms only slightly so.

Suggested Citation

  • Jürgen Jerger & Jenny Körner, 2019. "Brexit and macroprudential regulation: a DSGE perspective," International Economics and Economic Policy, Springer, vol. 16(1), pages 51-64, March.
    • Handle: RePEc:kap:iecepo:v:16:y:2019:i:1:d:10.1007_s10368-018-00429-8
    DOI: 10.1007/s10368-018-00429-8
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    Cited by:

    1. Li, Kexin & Chen, Zhongfei & Andrikopoulos, Athanasios, 2024. "Capital inflow liberalization and bank credit risk," Journal of International Money and Finance, Elsevier, vol. 142(C).
    2. Margarita Rubio, 2024. "Macroprudential policies and Brexit: A welfare analysis," Economic Inquiry, Western Economic Association International, vol. 62(3), pages 1246-1267, July.

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