Financial Openness, Bank Capital Flows and the Effectiveness of Macroprudential Policies
Time ：October 31th (Tuesday) 4:15-5:30 pm
Location：Jinhe Center Room 874
Speaker： Hao Jin
Dr. Hao Jin is currently an assistant professor in the School of Economics and Wang Yanan Institute for Studies in Economics. He got his Ph.D. degree in Economics from Indiana University, Bloomington. His research focuses on Macroeconomics, International Economics, Monetary Economics, and Applied Econometrics. He has been invited to present his research at many international conferences, such as Asian Meeting of Econometric Society, China Meeting of Econometric Society, Midwest Macroeconomics Meeting, Columbia-Tsinghua Conference in International Economics, St. Louis Federal Reserve-Missouri Economics Conference.
We study the macroeconomic and welfare implications of macroprudential policies in a small open economy DSGE model with cross border bank financing. Consistent with the empirical evidence, our model shows macroprudential policies that regulate the overall financing of banks lower the growth in credit, but result in more cross-border bank borrowing and are thus less effective in financially more integrated economies. On the other hand, in financially more developed economies, financial openness does not affect the effectiveness of macroprudential policies.