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Advisor(s)
Abstract(s)
The relationship between MaPP and growth is examined in four related chapters. Each chapter uses a novel empirical approach to estimate the causal effects of MaPP on some of the most important determinants of growth. The first chapter is a joint work with Zoe Venter and it is published in the International Journal of Central Banking. Using a novel difference-in-differences with staggered adoption, we show that MaPP reduces household consumption and increases firm investment. We find that some prudential tools have pernicious effects on consumption, while others lead to higher firm investment. The effects of MaPP are found to be relatively mild in the short run but become more pronounced in the long run. These findings point to a weaker macroeconomic impact of MaPP than suggested in previous studies. The second chapter is published in the Journal of Policy Modeling. I use micro-level data from 122 countries to examine how MaPP affects individual behaviour. I find that people save more and borrow less after the adoption of MaPP. These effects are then disaggregated by policy tool , interest rate, and country income level. The results show that the effects of MaPP depend more on the design of the policy tool and the country's income level and less on the interest rate. These findings stand up to a variety of endogeneity tests that include propensity score matching and an instrumental variable approach. The third chapter is published in the Journal of Financial Stability. I examine the effects of MaPP on wealth inequality based on a large sample of 171 countries. I find that, after the adoption of MaPP, wealth concentration in the treated countries increases by 3.4 percentage points in a decade. This finding is explained by a rise in the wealth share of the top 1% combined with a sharp decline in the wealth share of the bottom 50%. These effects are stronger for prudential rules based on income, particularly in advanced economies. The fourth and final chapter is a joint work with Antonio Afonso and is under review in a similar-level journal. We investigate the impact of banking prudential regulation on sovereign risk. As long as prudential regulation improves financial stability, it lowers sovereign risk and enables governments to increase their spending. Consequently, countries with prudential regulation have lower primary budget balances and accumulate more government debt over time. These results suggest that prudential regulation reduces private debt, while paradoxically increasing public debt. We explore several explanations for this paradox. Our results indicate that prudential regulation induces governments to accumulate debt because it improves a nation's credit rating and its borrowing conditions in sovereign bond markets.
Description
Doutoramento em Economia
Keywords
Política macroprudencial Crescimento
Pedagogical Context
Citation
Teixeira, André Manuel Ventura Soares (2024). "Essays on macroprudential policy and growth". Tese de Doutoramento. Universidade de Lisboa. Instituto Superior de Economia e Gestão.
Publisher
Instituto Superior de Economia e Gestão