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The Micro Impact of Macroprudential Policies: Firm-Level Evidence
Author:
Meghana Ayyagarinull

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Thorsten Becknull

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Mr. Maria Soledad Martinez Perianull

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Series:
IMF Working Papers
Volume/Issue:
Volume 2018: Issue 267
Language:
English
Publication Date:
07 Dec 2018
DOI:
https://doi.org/10.5089/9781484385654.001
ISBN:
9781484385654
ISSN:
1018-5941
Pages:
65
Keywords:
WP; financing growth; firm assets; micro firm; balance sheet data; financing constraint; firm characteristic; return on assets; financial development; macroprudential policies; firm financing; Macroprudential policy; Macroprudential policy instruments; Small and medium enterprises; Global financial crisis of 2008-2009; Central bank policy rate; Global
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IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.
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Combining balance sheet data on 900,000 firms from 48 countries with information on the adoption of macroprudential policies during 2003-2011, we find that these policies are associated with lower credit growth. These effects are especially significant for micro, small and medium enterprises (MSMEs) and young firms that, according to the literature, are more financially constrained and bank dependent. Among MSMEs and young firms, those with weaker balance sheets exhibit lower credit growth in conjunction with the adoption of macroprudential policies, suggesting that these policies can enhance financial stability. Finally, our results show that macroprudential policies have real effects, as they are associated with lower investment and sales growth.
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Cover IMF Working Papers
IMF Working Papers
ISSN:
1018-5941
Publisher:
International Monetary Fund
Volume 2018: Issue 267