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on Banking |
| By: | Tobias Adrian; Adam B. Ashcraft |
| Abstract: | Shadow banks conduct credit intermediation without direct, explicit access to public sources of liquidity and credit guarantees. Shadow banks contributed to the credit boom in the early 2000s and collapsed during the financial crisis of 2007-09. We review the rapidly growing literature on shadow banking and provide a conceptual framework for its regulation. Since the financial crisis, regulatory reform efforts have aimed at strengthening the stability of the shadow banking system. We review the implications of these reform efforts for shadow funding sources including asset-backed commercial paper, triparty repurchase agreements, money market mutual funds, and securitization. Despite significant efforts by lawmakers, regulators, and accountants, we find that progress in achieving a more stable shadow banking system has been uneven. |
| Keywords: | Intermediation (Finance) ; Banks and banking - Regulations ; Financial market regulatory reform ; Credit |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fednsr:559&r=ban |
| By: | Armen Hovakimian; Edward J. Kane; Luc Laeven |
| Abstract: | This paper proposes a theoretically sound and easy-to-implement way to measure the systemic risk of financial institutions using publicly available accounting and stock market data. The measure models credit risk of banks as a put option on bank assets, a tradition that originated with Merton (1974). We extend his contribution by expressing the value of banking-sector losses from systemic default risk as the value of a put option written on a portfolio of aggregate bank assets whose exercise price equals the face value of aggregate bank debt. We conceive of an individual bank’s systemic risk as its contribution to the value of this potential sector-wide put on the financial safety net. To track the interaction of private and governmental sources of systemic risk during and in advance of successive business-cycle contractions, we apply our model to quarterly data over the period 1974-2010. Results indicate that systemic risk reached unprecedented highs during the years 2008-2010, and that bank size, leverage, and asset risk are key drivers of systemic risk. |
| JEL: | G01 G21 G28 |
| Date: | 2012–05 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:18043&r=ban |
| By: | Sheri M. Markose; Bewaji Oluwasegun; Simone Giansante |
| Abstract: | A database driven multi-agent model has been developed with automated access to US bank level FDIC Call Reports which yield data on balance sheet and off balance sheet activity, respectively, in Residential Mortgage Backed Securities (RMBS) and Credit Default Swaps (CDS). The simultaneous accumulation of RMBS assets on US banks’ balance sheets and also large counterparty exposures from CDS positions characterized the $2 trillion Collateralized Debt Obligation (CDO) market. The latter imploded by end of 2007 with large scale systemic risk consequences. Based on US FDIC bank data, that could have been available to the regulator at the time, we investigate how a CDS negative carry trade combined with incentives provided by Basel II and its precursor in the US, the Joint Agencies Rule 66 Federal Regulation No. 56914 which became effective on January 1, 2002, on synthetic securitization and credit risk transfer (CRT), led to the unsustainable trends and systemic risk. The resultant market structure with heavy concentration in CDS activity involving 5 US banks can be shown to present too interconnected to fail systemic risk outcomes. The simulation package can generate the financial network of obligations of the US banks in the CDS market. We aim to show how such a multi-agent financial network (MAFN) model is well suited to monitor bank activity and to stress test policy for perverse incentives on an ongoing basis. |
| Date: | 2012–03–01 |
| URL: | http://d.repec.org/n?u=RePEc:esx:essedp:714&r=ban |
| By: | Binici, Mahir; Köksal, Bülent; Orman, Cüneyt |
| Abstract: | This paper investigates the evolution of systemic risk in the Turkish banking sector over the past two decades using comovement of banks’ stock returns as a systemic risk indicator. In addition, we explore possible determinants of systemic risk, the knowledge of which can be a useful input into effective macroprudential policymaking. Results show that the correlations between bank stock returns almost doubled in 2000s in comparison to 1990s. The correlations decreased somewhat after 2002 and increased again as a result of the 2007-2009 financial crisis. Main determinants of systemic risk appear to be the market share of bank pairs, the amount of non-performing loans, herding behavior of banks, and volatilities of macro variables including the exchange rate, U.S. T-bills, EMBI+, VIX, and MSCI emerging markets index. |
| Keywords: | Stock returns; comovement; systemic risk; Turkish banking system |
| JEL: | G32 C22 G21 G01 |
| Date: | 2012–05–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:38663&r=ban |
| By: | Lakshmi Balasubramanyan; David D. VanHoose |
| Abstract: | This paper presents a dynamic model of a bank’s optimal choices of imposing a binding liquidity-coverage-ratio (LCR) constraint. Our baseline balance-sheet dynamics starts with portfolio separation and no LCR constraint. Under a scenario in which regulators prohibit banks from applying securities to fulf ll the LCR constraint, portfolio separation continues to hold, but deposit holdings depend on the extent to which the LCR constraint is binding. When banks are allowed to apply securities toward satisfying the constraint, portfolio separation can break down and lead to ambiguous effects on optimal dynamic loan and deposit paths. Our results indicate that under special cases in which portfolio separation holds, the LCR constraint affects bank-sheet dynamics in ways not previously recognized. As regulators move forward in implementing Basel III style LCR, it is imperative to understand the effects of the LCR constraint on bank balance-sheet dynamics. |
| Keywords: | Banks and banking ; Liquidity (Economics) |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedcwp:1209&r=ban |
| By: | Torsten Wezel; Francesco Columba; Jorge A. Chan Lau |
| Abstract: | This simulation-based paper investigates the impact of different methods of dynamic provisioning on bank soundness and shows that this increasingly popular macroprudential tool can smooth provisioning costs over the credit cycle and lower banks’ probability of default. In addition, the paper offers an in-depth guide to implementation that addresses pertinent issues related to data requirements, calibration and safeguards as well as accounting, disclosure and tax treatment. It also discusses the interaction of dynamic provisioning with other macroprudential instruments such as countercyclical capital. |
| Keywords: | Bank soundness , Banks , Business cycles , Capital , Credit risk , Loans , |
| Date: | 2012–05–02 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:12/110&r=ban |
| By: | Mircea Epure; Esteban Lafuente |
| Abstract: | This paper assesses bank performance from a monitoring perspective. We first propose a multidimensional efficiency measure that integrates credit risk and is adapted to the real banking technology. Second, accounting ratios complement the analysis and provide proximity to managerial communities. Third, the impact of different risk measures over efficiency and accounting ratios is shown. Fourth, we examine the effect of CEO turnover on future performance. An empirical application considers the Costa Rican banking industry during 1998-2007. Results reveal that performance improvements follow regulatory changes and that risk explains differences in bank performance. Specifically, non-performing loans negatively affect efficiency and return on assets, whereas the capital adequacy ratio has a positive impact on the net interest margin. This supports that incurring monitoring costs and having higher levels of capitalisation may lead to performance gains. Finally, results confirm that appointing CEOs from outside the bank significantly improves performance, thus suggesting the potential benefits of new organisational practices. |
| Keywords: | banking, data envelopment analysis, accounting ratios, risk, executive turnover |
| JEL: | G21 G28 G3 |
| Date: | 2012–03 |
| URL: | http://d.repec.org/n?u=RePEc:bge:wpaper:613&r=ban |
| By: | Cyril Pouvelle |
| Abstract: | This paper analyses the effect of asset prices on credit growth in France and tries to disentangle credit demand and supply factors, both for the whole 1993-2010 period and during periods of financial instability. Using bank-level panel data at a quarterly frequency, stock price growth is shown to have a significant effect on lending growth over the whole period, but without credit supply factors being singled out. By contrast, housing price growth has a significant effect during periods of financial instability only, even after controlling for credit demand effects. These results show that credit demand factors do play a large role but also provide evidence of tighter credit constraints on households in financial instability periods. |
| Keywords: | Asset prices , Bank credit , Banks , Corporate sector , Credit demand , Credit expansion , Economic models , Financial stability , Household credit , Housing prices , |
| Date: | 2012–04–24 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:12/103&r=ban |
| By: | Forte, Antonio; Cepparulo, Alessandra |
| Abstract: | In this study we try to explain the inclusion of banks in the WDCI list proposed by Bloomberg. This list collects a group of more than 100 banking institutions which, during the crisis, suffered losses. We explain the probability of being part of the list (to suffer severe or highly severe losses) by their structure and performance. These aspects are represented by 4 variables: ROA, tier1 ratio, number of employees and total assets, referred to the two years preceding the crisis, of a larger sample of more than 400 banks comprehending the banks in and outside the list. By considering the heterogeneity among the banks of the list, an explanation of the probability of highly sever losses is offered by considering the previous variables with the addition of interbanking assets. By using a probit model we find a confirmation of the new rules, inspired by the Basel 3 Accord and by the Financial Stability Board, requiring a solid patrimonial structure, in particular for the “too big to fail” financial institutions, accompanied by a medium return in order to assure a low probability to suffer losses. |
| Keywords: | Bank; Tier1; financial crisis; losses |
| JEL: | G21 G01 |
| Date: | 2012–05 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:38539&r=ban |
| By: | Andrew Powell; Marcus Miller; Antonia Maier |
| Abstract: | The recent financial crisis has forced a rethink of banking regulation and supervision and the role of financial innovation. This paper develops a model where prudent banks may signal their type through high capital ratios. Capital regulation may ensure separation in equilibrium, but deposit insurance will tend to increase the level of capital required. If supervision detects risky behavior ex ante then it is complementary to capital regulation. However, financial innovation may erode supervisors’ ability to detect risk and capital levels should then be higher. Regulators, however, may not be aware their capacities have been undermined. The paper argues for a four-prong policy response with higher bank capital ratios, enhanced supervision, limits to the use of complex financial instruments and Coco’s. The results may support the institutional arrangements proposed recently in the United Kingdom. |
| JEL: | D82 G21 G38 L51 |
| Date: | 2011–12 |
| URL: | http://d.repec.org/n?u=RePEc:idb:wpaper:4760&r=ban |
| By: | Nicola Gennaioli; Andrei Shleifer; Robert Vishny |
| Abstract: | We present a model of shadow banking in which financial intermediaries originate and trade loans, assemble these loans into diversified portfolios, and then finance these portfolios externally with riskless debt. In this model: i) outside investor wealth drives the demand for riskless debt and indirectly for securitization, ii) intermediary assets and leverage move together as in Adrian and Shin (2010), and iii) intermediaries increase their exposure to systematic risk as they reduce their idiosyncratic risk through diversification, as in Acharya, Schnabl, and Suarez (2010). Under rational expectations, the shadow banking system is stable and improves welfare. When investors and intermediaries neglect tail risks, however, the expansion of risky lending and the concentration of risks in the intermediaries create financial fragility and fluctuations in liquidity over time. |
| Keywords: | securitization, neglected risk, financial fragility |
| JEL: | E51 E44 G2 |
| Date: | 2011–05 |
| URL: | http://d.repec.org/n?u=RePEc:bge:wpaper:576&r=ban |
| By: | Weber, Ron; Musshoff, Oliver |
| Abstract: | On the example of a commercial microfinance institution (MFI) in Tanzania this paper investigates first whether agricultural firms have a different probability to get a loan and whether their loans are differently volume rationed than loans to non-agricultural firms. Second, we analyze whether agricultural firms repay their loans with different delinquencies than non-agricultural firms. Our results reveal that agricultural firms face higher obstacles to get credit but as soon as they have access to credit, their loans are not differently volume rationed than those of non-agricultural firms. Furthermore, agricultural firms are less often delinquent when paying back their loans than non-agricultural firms. Our findings suggest that a higher risk exposition of agricultural firms does not necessarily lead to higher credit risk. They also show that the investigated MFI overestimates the credit risk of agricultural clients and, hence, should reconsider its risk assessment practice to be able to increase lending to the agricultural sector. In addition, our results might indicate that farmers qualify less often for a loan as they do not fit into the standard micro credit product. |
| Keywords: | Agricultural Finance, Access to Credit, Loan Repayment, Microfinance Institutions, Financial Economics, International Development, Risk and Uncertainty, G21, G32, Q14, |
| Date: | 2012–02–23 |
| URL: | http://d.repec.org/n?u=RePEc:ags:eaa123:122552&r=ban |
| By: | Richard P.C. Brown (School of Economics, The University of Queensland); Fabrizio Carmignani (School of Economics, The University of Queensland) |
| Abstract: | We investigate the effect of remittances on bank credit in developing countries. Understanding this link is important in view of the growing relevance of remittances as a source of external finance and of the beneficial impact that financial intermediation is likely to have on economic growth. Using a simple theoretical formalization, we predict the relationship to be U-shaped. We test this prediction using panel data for a large group of developing and emerging economies over the period 1960-2009. The empirical results suggest that at initially low levels of remittances, an increase in remittances reduces the volume of credit extended by banks. However, at sufficiently high levels of remittances, the effect becomes positive. The turning point of the relationship occurs at a level of remittances of about 2.5% of GDP. |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:qld:uq2004:461&r=ban |
| By: | Theoharry Grammatikos; Robert Vermeulen |
| Abstract: | This paper highlights the impact of credit supply and aggregate demand sensitivity on 91 US industries’ stock performance during the 2007-2009 financial crisis. We account explicitly for changes in the market model and investigate, next to stock returns, the changes in systematic risk and idiosyncratic return induced by the financial crisis. The results show that leverage has a significantly positive effect on systematic risk changes during the financial crisis. After accounting for the change in systematic risk, the crisis induced idiosyncratic return is significantly related to industry leverage and the industry’s sensitivity to aggregate demand. A subsequent analysis shows that both leverage and demand sensitivity have economically large effects on industry performance during the crisis. |
| Keywords: | financial crisis; systematic risk; credit supply; aggregate demand |
| JEL: | G01 G12 G32 |
| Date: | 2012–05 |
| URL: | http://d.repec.org/n?u=RePEc:dnb:dnbwpp:344&r=ban |
| By: | Rahul Kaushik; Stefano Battiston |
| Abstract: | We analyse time series of CDS spreads for a set of major US and European institutions on a pe- riod overlapping the recent financial crisis. We extend the existing methodology of {\epsilon}-drawdowns to the one of joint {\epsilon}-drawups, in order to estimate the conditional probabilities of abrupt co-movements among spreads. We correct for randomness and for finite size effects and we find significant prob- ability of joint drawups for certain pairs of CDS. We also find significant probability of trend rein- forcement, i.e. drawups in a given CDS followed by drawups in the same CDS. Finally, we take the matrix of probability of joint drawups as an estimate of the network of financial dependencies among institutions. We then carry out a network analysis that provides insights into the role of systemically important financial institutions. |
| Date: | 2012–05 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:1205.0976&r=ban |
| By: | Benjamin M. Tabak; Rogério B. Miranda; Dimas M. Fazio |
| Abstract: | The objective of this article is to discuss a new approach to control for the environment when one estimates efficiency by the stochastic frontier model. By introducing geographical weights and estimating local frontiers for each US saving bank for 2001-09, we find that bank technical performance is higher for most banks in comparison to a fixed-effects approach. This result highlights the importance of explicitly considering local environment and constraints while analyzing banks' behavior. All in all, this model has been proved very promising and viable for future empirical studies. |
| Date: | 2012–04 |
| URL: | http://d.repec.org/n?u=RePEc:bcb:wpaper:275&r=ban |
| By: | Dominique Guegan (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Paris I - Panthéon Sorbonne, EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris); Xin Zhao (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Paris I - Panthéon Sorbonne) |
| Abstract: | In this paper, we propose an alternative approach to estimate long-term risk. Instead of using the static square root method, we use a dynamic approach based on volatility forecasting by non-linear models. We explore the possibility of improving the estimations by different models and distributions. By comparing the estimations of two risk measures, value at risk and expected shortfall, with different models and innovations at short, median and long-term horizon, we find out that the best model varies with the forecasting horizon and the generalized Pareto distribution gives the most conservative estimations with all the models at all the horizons. The empirical results show that the square root method underestimates risk at long horizon and our approach is more competitive for risk estimation at long term. |
| Keywords: | Long memory, Value at Risk, expect shortfall, extreme value distribution. |
| Date: | 2012–04 |
| URL: | http://d.repec.org/n?u=RePEc:hal:cesptp:halshs-00694449&r=ban |
| By: | Nidhi Aggarwal (Indira Gandhi Institute of Development Research); Manish Singh (Indira Gandhi Institute of Development Research); Susan Thomas (Indira Gandhi Institute of Development Research) |
| Abstract: | Distance-to-default (DtD) from the Merton model has been used in the credit risk literature, most successfully as an input into reduced form models for forecasting default. In this paper, we suggest that the change in the DtD is informative for predicting change in the credit rating. This is directly useful for situations where forecasts of credit rating changes are required. More generally, it contributes to our knowledge about reduced form models of credit risk. |
| Keywords: | Distance to Default, rating downgrades, rating change, forecasts, event study analysis, probit models, simulation, bootstrap, crisis analysis |
| JEL: | C53 C58 G14 G17 G21 |
| Date: | 2012–03 |
| URL: | http://d.repec.org/n?u=RePEc:ind:igiwpp:2012-010&r=ban |
| By: | Ricardo Bebczuk (Central Bank of Argentina); Tamara Burdisso (Central Bank of Argentina); Jorge Carrera (Central Bank of Argentina); Máximo Sangiácomo (Central Bank of Argentina) |
| Abstract: | The goal of this paper is to provide up-to-date worldwide evidence on the short-term relationship between credit changes and output changes. Standard correlation methods, state of-the-art panel Granger causality tests, and panel regressions were applied on a maximum sample of 144 countries over the period 1990-2007. Our results openly clash with two popular economic statements, namely, that credit is procyclical and that changes in credit have strong effects on private expenditure. According to the evidence produced, credit procyclicality -in the sense that the simple correlation coefficient is positive and significant at 10% or less- prevails in just 45% of the countries when annual data are used (23% with quarterly data). As for time precedence, our work suggests that, for the full sample, Granger causality runs from GDP to credit, while the often claimed causality from credit to GDP is a feature observable much less frequently –this behavior is observed only in financially developed countries. Results are robust to random resampling. Furthermore, after considering the potential presence of endogeneity, we contend that our results uncover not just mere Granger causality but economic causality. All in all, these findings have vast academic and policy implications. |
| Keywords: | credit procyclicality, financial system, Granger causality, panel regressions |
| JEL: | C33 E32 G10 |
| Date: | 2011–10 |
| URL: | http://d.repec.org/n?u=RePEc:bcr:wpaper:201155&r=ban |
| By: | Filippo Ippolito; Ander Perez |
| Abstract: | In this paper we offer the first large sample evidence on the availability and usage of credit lines in U.S. public corporations and use it to re-examine the existing findings on corporate liquidity. We show that the availability of credit lines is widespread and that average undrawn credit is of the same order of magnitude as cash holdings. We test the trade-off theory of liquidity according to which firms target an optimum level of liquidity, computed as the sum of cash and undrawn credit lines. We provide support for the existence of a liquidity target, but also show that the reasons why firms hold cash and credit lines are very different. While the precautionary motive explains well cash holdings, the optimum level of credit lines appears to be driven by the restrictions imposed by the credit line itself, in terms of stated purpose and covenants. In support to these findings, credit line drawdowns are associated with capital expenditures, acquisitions, and working capital. |
| Keywords: | cash holdings, credit lines, lines of credit, revolving credit facilities, trade-off theory, liquidity, financial constraints, covenants |
| JEL: | G30 G31 D22 |
| Date: | 2012–03 |
| URL: | http://d.repec.org/n?u=RePEc:bge:wpaper:618&r=ban |
| By: | Willi Semmler; Lucas Bernard |
| Abstract: | Recent history suggests that many boom-bust cycles are naturally driven by linkages between the credit market and asset prices. Additionally, new structured securities have been developed, e.g., MBS, CDOs, and CDS, which have acted as instruments of risk transfer. We show that there is a certain non-robustness in the pricing of these instruments and we create a model in which their role in the recent financial market meltdown, and in which the mechanism by which they exacerbate leverage cycles, is explicit. We first discuss the extent to which complex securities can amplify boom-bust cycles. Then, we propose a model in which distinct financial market boom-bust cycles emerge naturally. We demonstrate the interaction of leveraging and asset pricing in a dynamical model and spell out some implications for monetary policy. |
| Keywords: | Credit, Leverage, Mortgage, Credit Risk, Structured Finance, Leveraged Financing, Mortgage-backed Security, Collateral, Collateralized Default Obligation, Booms, Busts, Dynamic, Cycles |
| JEL: | C61 C63 G21 D83 D92 |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:deg:conpap:c016_034&r=ban |
| By: | Stefan Mittnik; Willi Semmler |
| Abstract: | This paper studies the issue of local instability of the banking sector and how it may spillover to the macroeconomy. The banking sector is considered here as representing a wealth fund that accumulates capital assets, can heavily borrow and pays bonuses. We presume that the banking system faces not only loan losses but is also exposed to a deterioration of its balances sheets due to adverse movements in asset prices. In contrast to previous studies that use the financial accelerator – which is locally amplifying but globally stable and mean reverting – our model shows local instability and globally multiple regimes. Whereas the financial accelerator leads, in terms of econometrics, to a one-regime VAR we demonstrate the usefulness of a multi-regime VAR (MRVAR). We estimate our model for the US with a MRVAR using a constructed financial stress index and industrial production. We also undertake an impulse-response study with an MRVAR which allows us to explore regime dependent shocks. We show that the shocks have asymmetric effects depending on the regime the economy is in and the size of the shocks. As to the recently discussed unconventional monetary policy of quantitative easing we demonstrate that the effects of monetary shocks are also dependent on the size of the shocks. |
| JEL: | E2 E6 C13 |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:deg:conpap:c016_080&r=ban |
| By: | Simon Gilchrist; Jae W. Sim; Egon Zakrajsek |
| Abstract: | Financial market frictions distort the allocation of resources among productive units—all else equal, firms whose financing choices are affected by financial frictions face higher borrowing costs than firms with ready access to capital markets. As a result, input choices may differ systematically across firms in ways that are unrelated to their productive efficiency. We propose a simple accounting framework that allows us to assess the empirical magnitude of the loss in aggregate resources due to such misallocation. To a second-order approximation, our accounting framework requires only information on the dispersion in borrowing costs across firms. We measure firm-specific borrowing costs for a subset of U.S. manufacturing firms directly from the interest rate spreads on their outstanding publicly-traded debt. Given the observed variation in borrowing costs, our approximation method implies a relatively modest loss in efficiency due to resource misallocation—on the order of 1 to 2 percent of measured total factor productivity (TFP). According to our accounting framework, the correlation between firm size and borrowing costs is irrelevant under the assumption that financial distortions and firm-level efficiency are jointly log-normally distributed. To take into account the effect of covariation between firm size and borrowing costs, we also consider a more general framework that dispenses with the assumption of log-normality and which yields somewhat higher estimates of the resource losses—about 3.5 percent of measured TFP. Counterfactual experiments indicate that dispersion in borrowing costs must be an order of magnitude higher than that observed in the U.S. financial data, in order for misallocation—arising from financial distortion—to account for a significant fraction of measured TFP differentials across countries. |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedgfe:2012-08&r=ban |
| By: | Fabian Valencia; Kenichi Ueda |
| Abstract: | We consider the optimality of various institutional arrangements for agencies that conduct macro-prudential regulation and monetary policy. When a central bank is in charge of price and financial stability, a new time inconsistency problem may arise. Ex-ante, the central bank chooses the socially optimal level of inflation. Ex-post, however, the central bank chooses inflation above the social optimum to reduce the real value of private debt. This inefficient outcome arises when macro-prudential policies cannot be adjusted as frequently as monetary. Importantly, this result arises even when the central bank is politically independent. We then consider the role of political pressures in the spirit of Barro and Gordon (1983). We show that if either the macro-prudential regulator or the central bank (or both) are not politically independent, separation of price and financial stability objectives does not deliver the social optimum. |
| Keywords: | Central bank autonomy , Central banks , Economic models , Monetary policy , |
| Date: | 2012–04–23 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:12/101&r=ban |