THE EFFECTIVENESS OF TRILEMMA POLICY CHOICE IN THE PRESENCE OF MACROPRUDENTIAL POLICIES: EVIDENCE FROM EMERGING ECONOMIES-Reference-Cited by-同舟云学术

THE EFFECTIVENESS OF TRILEMMA POLICY CHOICE IN THE PRESENCE OF MACROPRUDENTIAL POLICIES: EVIDENCE FROM EMERGING ECONOMIES

Published:2021-05-18 Issue: Volume: Page:1-33
ISSN:0217-5908
Container-title:The Singapore Economic Review
language:en
Short-container-title:Singapore Econ. Rev.

Author:

JUHRO SOLIKIN M.¹,PRABHEESH K. P.²,LUBIS ALEXANDER³

Affiliation:

1. Bank Indonesia Institute, Bank Indonesia, Jakarta, Indonesia

2. Indian Institute of Technology Hyderabad, Hyderabad, India

3. Economic and Monetary Policy Department, Bank Indonesia, Jakarta, Indonesia

Abstract

This paper examines the effectiveness of the trilemma policy choice, in the presence of macroprudential policies in ten emerging market economies. We address this issue due to the extensive use of macroprudential policies to maintain financial stability in the aftermath of global financial crisis. Our overall findings suggest that adoption of macroprudential policies with monetary policy helps to maintain macroeconomic stability in 6 out of 10 cases, and with capital account openness being effective only in three cases. Our findings suggest that the emerging economies’ policymakers can optimize the effectiveness of trilemma policy choice by giving more weightage to macroprudential policies along with exchange rate stability and monetary policy.

Publisher

World Scientific Pub Co Pte Lt

Subject

Economics and Econometrics

Link

https://www.worldscientific.com/doi/pdf/10.1142/S0217590821410058

Reference64 articles.

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