Bank for International Settlements

Displaying 1-40 of 94 results

  • White Papers // Aug 2011

    Weathering The Financial Crisis: Good Policy Or Good Luck?

    The macroeconomic performance of individual countries varied markedly during the 2007 - 09 global financial crisis. While China's growth never dipped below 6% and Australia's worst quarter was no growth, the economies of Japan, Mexico and the United Kingdom suffered annualised GDP contractions of 5 - 10% per quarter for...

    Provided By Bank for International Settlements

  • White Papers // Jul 2011

    The International Propagation Of The Financial Crisis Of 2008 And A Comparison With 1931

    The authors examine the international propagation of the financial crisis of 2008, and compare it with that of the crisis of 1931. They argue that the collateral squeeze in the United States, which became intense after the failure of Lehman Brothers created doubts about the stability of other financial companies,...

    Provided By Bank for International Settlements

  • White Papers // May 2011

    On Harnessing The Potential Of Financial Inclusion

    The development of information and communications technology is opening up the opportunity for providing essential financial services to most people. Indeed, many mobile money or branchless banking schemes are currently spreading across the world. However, these schemes can only be sustainable if they are built on a commercially viable business...

    Provided By Bank for International Settlements

  • White Papers // May 2011

    Global Imbalances And The Financial Crisis: Link Or No Link?

    Global current account imbalances have been at the forefront of policy debates over the past few years. Many observers have recently singled them out as a key factor contributing to the global financial crisis. Current account surpluses in several emerging market economies are said to have helped fuel the credit...

    Provided By Bank for International Settlements

  • White Papers // Apr 2011

    Dislocations In The Won-Dollar Swap Markets During The Crisis Of 2007-09

    Foreign eXchange (FX) derivatives markets in the Korean won are comparatively thin and vulnerable to impaired functioning. During the crisis, Korea faced dislocations in its FX swap and cross-currency swap markets, so severe that Covered Interest Parity (CIP) between the Korean won and the US dollar was seriously violated. Using...

    Provided By Bank for International Settlements

  • White Papers // Apr 2011

    Market Structures And Systemic Risks Of Exchange-Traded Funds

    Crisis experience has shown that as the financial intermediation chain lengthens, it becomes complicated to assess the risks of financial products due to a lack of transparency as to how risks are managed at different levels of the intermediation chain. Exchange-traded funds, which have become popular among investors seeking exposure...

    Provided By Bank for International Settlements

  • White Papers // Mar 2011

    Measuring The Systemic Importance Of Interconnected Banks

    The authors develop a measure of systemic importance that accounts for the extent to which a bank propagates shocks across the banking system and is vulnerable to propagated shocks. Based on Shapley values, this measure gauges the contribution of interconnected banks to systemic risk, in contrast to other measures proposed...

    Provided By Bank for International Settlements

  • White Papers // Mar 2011

    Securitization Is Not That Evil After All

    A growing number of studies on the US subprime market indicate that, due to asymmetric information, credit risk transfer activities have perverse effects on banks' lending standards. The authors investigate a large part of the market for securitized assets ("Prime mortgages") in Italy, a country with a regulatory framework analogous...

    Provided By Bank for International Settlements

  • White Papers // Feb 2011

    Cyclical Fiscal Policy, Credit Constraints, And Industry Growth

    This paper analyzes the impact of cyclical fiscal policy on industry growth. Using Rajan and Zingales' (1998) difference-in-difference methodology on a panel data sample of manufacturing industries across 15 OECD countries over the period 1980-2005, the authors show that industries with relatively heavier reliance on external finance or lower asset...

    Provided By Bank for International Settlements

  • White Papers // Feb 2011

    Measuring Disagreement In UK Consumer And Central Bank Inflation Forecasts

    The authors provide a new perspective on disagreement in inflation expectations by examining the full probability distributions of UK consumer inflation forecasts based on an adaptive bootstrap multimodality test. Furthermore, they compare the inflation forecasts of the Bank of England's Monetary Policy Committee (MPC) with those of UK consumers, for...

    Provided By Bank for International Settlements

  • White Papers // Feb 2011

    Basel III: Long-Term Impact On Economic Performance And Fluctuations

    The authors assess the long-term economic impact of the new regulatory standards (the Basel III reform), answering the following questions. What is the impact of the reform on long-term economic performance? What is the impact of the reform on economic fluctuations? What is the impact of the adoption of countercyclical...

    Provided By Bank for International Settlements

  • White Papers // Feb 2011

    Macroprudential Policy - A Literature Review

    The recent financial crisis has highlighted the need to go beyond a purely micro approach to financial regulation and supervision. In recent months, the number of policy speeches, research papers and conferences that discuss a macro perspective on financial regulation has grown considerably. The policy debate is focusing in particular...

    Provided By Bank for International Settlements

  • White Papers // Jan 2011

    Policymaking From A "Macroprudential" Perspective In Emerging Market Economies

    Recurrent capital inflows pose important challenges for authorities in emerging market economies seeking to preserve financial stability. Raising interest rates to dampen imbalances that could arise from capital flows can also attract more capital inflows and accentuate appreciation pressures. This paper reviews some of these instruments, drawing in part on...

    Provided By Bank for International Settlements

  • White Papers // Jan 2011

    The Future Of Central Banking Under Post-Crisis Mandates

    The role of central banks in preserving price stability and fostering financial stability has varied over time and differed across countries. However, at the beginning of the 21st century a number of common features and principal tendencies emerged. The financial crisis has raised important issues with regard to the role...

    Provided By Bank for International Settlements

  • White Papers // Dec 2010

    The Global Crisis And Financial Intermediation In Emerging Market Economies

    The global financial crisis shook the foundations of international banking and finance and put the international banking system under intense stress. Many financial markets became dysfunctional, and many international banks went bankrupt. Although the crisis originated in advanced economies, it quickly moved to emerging market economies (EMEs), particularly in the...

    Provided By Bank for International Settlements

  • White Papers // Dec 2010

    Why Issue Bonds Offshore?

    This paper asks why Asia-Pacific residents issue debt in offshore markets and considers the implications for domestic debt markets. The authors use unit record data for bond issuance by non-government residents of Australia, Hong Kong, Korea, Japan and Singapore to link the decision to issue offshore to potential benefits. The...

    Provided By Bank for International Settlements

  • White Papers // Dec 2010

    Banking Crises And The International Monetary System In The Great Depression And Now

    The authors compare the banking crises in 2008-09 and in the Great Depression, and analyze differences in the policy response to the two crises in light of the prevailing international monetary systems. The scale of the 2008-09 banking crisis, as measured by falls in international short-term indebtedness and total bank...

    Provided By Bank for International Settlements

  • White Papers // Nov 2010

    The Governance Of Financial Regulation: Reform Lessons From The Recent Crisis

    There was a systemic failure of financial regulation: senior policymakers repeatedly enacted and implemented policies that stabilized the global financial system. They maintained these policies even as they learned of the consequences of their policies during the decade before the crisis. The crisis does not primarily reflect an absence of...

    Provided By Bank for International Settlements

  • White Papers // Nov 2010

    To Err Is Human: Rating Agencies And The Interwar Foreign Government Debt Crisis

    The authors compare the banking crises in 2008-09 and in the Great Depression, and analyze differences in the policy response to the two crises in light of the prevailing international monetary systems. The scale of the 2008-09 banking crisis, as measured by falls in international short-term indebtedness and total bank...

    Provided By Bank for International Settlements

  • White Papers // Nov 2010

    The Impact Of CDS Trading On The Bond Market: Evidence From Asia

    This paper investigates the impact of CDS trading on the development of the bond market in Asia. In general, CDS trading has lowered the cost of issuing bonds and enhanced the liquidity in the bond market. The positive impact is stronger for smaller firms, non-financial firms and those firms with...

    Provided By Bank for International Settlements

  • White Papers // Nov 2010

    Central Banks And Competition Authorities: Institutional Comparisons And New Concerns

    The establishment of independent authorities for monetary policy and for competition policy was part of the institutional consensus of the Great Moderation. The paper contrasts how policy has operated in the two spheres, especially as regards the role of law. It then discusses the application of competition policy to banks...

    Provided By Bank for International Settlements

  • White Papers // Nov 2010

    Minimizing Monetary Policy

    The response of leading central banks to the current financial crisis has raised the magnitude of the financial and governance risks they face. An evaluation of the financial strength of a number of those banks suggests that they are in little danger of being forced by financial losses to alter...

    Provided By Bank for International Settlements

  • White Papers // Nov 2010

    The Federal Reserve, The Bank Of England And The Rise Of The Dollar As An International Currency, 1914-39

    This paper provides new evidence on the rise of the dollar as an international currency, focusing on its role in the conduct of trade and the provision of trade credit. The authors show that the shift to the dollar occurred much earlier than conventionally supposed: during and immediately after World...

    Provided By Bank for International Settlements

  • White Papers // Nov 2010

    Central Banks: Between Internationalization And Domestic Political Control

    The paper examines the exercise, the efficiency, and the legitimacy of the monetary policy-making process. The goal of central bank autonomy in recent times is the outcome of a demand for price stability. The realization of autonomy is also a consequence of the fragmentation of national decision making, in federal...

    Provided By Bank for International Settlements

  • White Papers // Nov 2010

    Mapping Capital And Liquidity Requirements To Bank Lending Spreads

    This paper outlines a methodology for mapping the increases in capital and liquidity requirements proposed under Basel III to bank lending spreads. The higher cost associated with a one percentage point increase in the capital ratio can be recovered by increasing lending spreads by 15 basis points for a representative...

    Provided By Bank for International Settlements

  • White Papers // Oct 2010

    The Changing Role Of Central Banks

    Although Central Banks have pursued the same objectives throughout their existence, primarily price and financial stability, the interpretation of their role in doing so has varied. So the search is now on for additional macro-prudential (counter-cyclical) instruments. The use of such instruments will need to be associated with controlled variations...

    Provided By Bank for International Settlements

  • White Papers // Oct 2010

    Inflation Risk Premia In The US And The Euro Area

    The authors use a joint model of macroeconomic and term structure dynamics to estimate inflation risk premia in the United States and the euro area. To sharpen the estimation, they include in the information set macro data and survey data on inflation and interest rate expectations at various future horizons,...

    Provided By Bank for International Settlements

  • White Papers // Oct 2010

    Stochastic Volatility, Long Run Risks, And Aggregate Stock Market Fluctuations

    What are the main drivers of fluctuations in the aggregate US stock market? In this paper, the authors attempt to resolve the long-lasting debate surrounding this question by designing and solving a consumption-based asset pricing model which incorporates stochastic volatility, long-run risks in consumption and dividends, and Epstein-Zin preferences. These...

    Provided By Bank for International Settlements

  • White Papers // Oct 2010

    Interbank Tiering And Money Center Banks

    This paper provides evidence that interbank markets are tiered rather than that, in the sense that most banks do not lend to each other directly but through money center banks acting as intermediaries. The authors capture the concept of tiering by developing a core-periphery model, and devise a procedure for...

    Provided By Bank for International Settlements

  • White Papers // Sep 2010

    Financial System And Macroeconomic Resilience: Revisited

    A last thought to conclude. It took about 60 years to gain a true understanding of the causes and dynamics of the Great Depression. When it comes to this crisis, there is still a long way to go. Our insights into financial transmission mechanisms are partial at best. Although extreme...

    Provided By Bank for International Settlements

  • White Papers // Sep 2010

    The Evolving Renminbi Regime And Implications For Asian Currency Stability

    The Chinese authorities described the management of the renminbi after its 2005 unpegging from the US dollar as involving a basket of trading partner currencies. Outside analysts have detected few signs of such management. The authors find that, in the two years from mid-2006 to mid-2008, the renminbi strengthened gradually...

    Provided By Bank for International Settlements

  • White Papers // Sep 2010

    Offshore Markets For The Domestic Currency: Monetary And Financial Stability Issues

    The authors show in this paper that offshore markets intermediate a large chunk of financial transactions in major reserve currencies such as the US dollar. The authors argue that, for emerging market economies that are interested in seeing some international use of their currencies, offshore markets can help to increase...

    Provided By Bank for International Settlements

  • White Papers // Sep 2010

    Macroeconomic And Interest Rate Volatility Under Alternative Monetary Operating Procedures

    During the financial crisis of 2007/08 the level and volatility of interest rate spreads increased dramatically. This paper examines how the choice of the target interest rate for monetary policy affects the volatility of inflation, the output gap and the yield curve. The authors consider three monetary policy operating procedures...

    Provided By Bank for International Settlements

  • White Papers // Aug 2010

    Ageing And Asset Prices

    The paper investigates how ageing will affect asset prices. A small model is used to show that economic and demographic factors drive asset, and in particular house, prices. These factors are estimated in a panel regression framework encompassing BIS real house price data from 22 advanced economies between 1970 and...

    Provided By Bank for International Settlements

  • White Papers // Jul 2010

    The International Financial Crisis And Policy Challenges In Asia And The Pacific

    This paper addresses financial stability issues in Asia and the Pacific. The keynote address by the author compares the attractiveness of two different models of commercial banking, specifically the Anglo-Saxon model and the Asian model. The author argues that the Anglo-Saxon model imploded during the crisis for good reasons. The...

    Provided By Bank for International Settlements

  • White Papers // Jul 2010

    Countercyclical Capital Buffers: Exploring Options

    This paper provides some general lessons for the design of countercyclical capital buffers. Its main empirical contribution is to analyze conditioning variables which could guide the build-up and release of capital. A major distinction for countercyclical capital schemes is whether conditioning variables are bank-specific or system-wide. The evidence presented in...

    Provided By Bank for International Settlements

  • White Papers // Jul 2010

    Funding Liquidity Risk: Definition And Measurement

    Funding liquidity risk has played a key role in all historical banking crises. Nevertheless, a measure based on publicly available data remains so far elusive. The authors address this gap by showing that aggressive bidding at central bank auctions reveals funding liquidity risk. They can extract an insurance premium from...

    Provided By Bank for International Settlements

  • White Papers // Jul 2010

    The Determinants Of Cross-Border Bank Flows To Emerging Markets: New Empirical Evidence On The Spread Of Financial Crises

    This paper studies the nature of spillover effects in bank lending flows from advanced to the emerging market economies and identifies specific channels through which such effects occur. Based on a gravity model the authors examine a panel data set on cross-border bank flows from 17 advanced to 28 emerging...

    Provided By Bank for International Settlements

  • White Papers // Jun 2010

    China's High Saving Rate: Myth And Reality

    The saving rate of China is high from many perspectives - historical experience, international standards and the predictions of economic models. Furthermore, the average saving rate has been rising over time, with much of the increase taking place in the 2000s, so that the aggregate marginal propensity to save exceeds...

    Provided By Bank for International Settlements

  • White Papers // Jun 2010

    Resolving The Financial Crisis: Are We Heeding The Lessons From The Nordics?

    How does the management and resolution of the current crisis compare with the response of the Nordic countries in the early 1990s, widely regarded as exemplary? The authors argue that, while intervention has been prompter, the measures taken so far remain less comprehensive and in-depth. In particular, the cleansing of...

    Provided By Bank for International Settlements

  • White Papers // Jun 2010

    China's High Saving Rate: Myth And Reality

    The saving rate of China is high from many perspectives - historical experience, international standards and the predictions of economic models. Furthermore, the average saving rate has been rising over time, with much of the increase taking place in the 2000s, so that the aggregate marginal propensity to save exceeds...

    Provided By Bank for International Settlements

  • White Papers // Jun 2010

    Resolving The Financial Crisis: Are We Heeding The Lessons From The Nordics?

    How does the management and resolution of the current crisis compare with the response of the Nordic countries in the early 1990s, widely regarded as exemplary? The authors argue that, while intervention has been prompter, the measures taken so far remain less comprehensive and in-depth. In particular, the cleansing of...

    Provided By Bank for International Settlements

  • White Papers // May 2010

    Toward A Global Risk Map

    Global risk maps are unified databases that provide risk exposure data to supervisors and the broader financial market community worldwide. The authors think of them as giant matrices that track the bilateral (firm-level) exposures of banks, non-bank financial institutions and other relevant market participants. While useful in principle, these giant...

    Provided By Bank for International Settlements

  • White Papers // May 2010

    Attributing Systemic Risk To Individual Institutions

    An operational macroprudential approach to financial stability requires tools that attribute system-wide risk to individual institutions. Making use of constructs from game theory, the authors propose an attribution methodology that has a number of appealing features: it can be used in conjunction with popular risk measures, it provides measures of...

    Provided By Bank for International Settlements

  • White Papers // Apr 2010

    Oil Shocks And Optimal Monetary Policy

    In practice, central banks have been confronted with a trade-o? between stabilizing inflation and output when dealing with rising oil prices. This contrasts with the result in the standard New Keynesian model that ensuring complete price stability is the optimal thing to do, even when an oil shock leads to...

    Provided By Bank for International Settlements

  • White Papers // Mar 2010

    Household Decisions, Credit Markets And The Macroeconomy: Implications For The Design Of Central Bank Models

    It is widely acknowledged that the recent generation of DSGE models failed to incorporate many of the liquidity and financial accelerator mechanisms revealed in the global financial crisis that began in 2007. This paper complements the papers presented at the 2009 BIS annual conference focused on the role of banks...

    Provided By Bank for International Settlements

  • White Papers // Mar 2010

    Fear Of Fire Sales And The Credit Freeze

    Is there any need to "Clean" up a banking system in the midst of a crisis, by closing or recapitalizing weak banks and taking bad assets off bank balance sheets, or can one wait till the crisis is over? The authors argue that an "Overhang" of impaired banks that may...

    Provided By Bank for International Settlements

  • White Papers // Mar 2010

    Financial Intermediation And The Post-Crisis Financial System

    Securitization was meant to disperse credit risk to those who were better able to bear it. In practice, securitization appears to have concentrated the risks in the financial intermediary sector itself. This paper outlines an accounting framework for the financial system for assessing the impact of securitization on financial stability....

    Provided By Bank for International Settlements

  • White Papers // Mar 2010

    Illiquidity And All Its Friends

    The recent crisis was characterized by massive illiquidity. This paper reviews what we know and don't know about illiquidity and all its friends: market freezes, fire sales, contagion, and ultimately insolvencies and bailouts. It first explains why liquidity cannot easily be apprehended through a single statistics, and asks whether liquidity...

    Provided By Bank for International Settlements

  • White Papers // Mar 2010

    Accounting Alchemy

    The controversy about the choice among accounting alternatives is often based on arguments suggesting heuristic behavior by market participants and firm managers. Debates focus on whether accounting methodology systematically alters reported earnings and whether this effect may add or subtract economic value independently of any effect on underlying cash flows....

    Provided By Bank for International Settlements

  • White Papers // Mar 2010

    The Failure Mechanics Of Dealer Banks

    The author explains the key failure mechanics of large dealer banks, and some policy implications. This is not a review of the financial crisis of 2007 - 2009. Systemic risk is considered only in passing. Both the financial crisis and the systemic importance of large dealer banks are nevertheless obvious...

    Provided By Bank for International Settlements

  • White Papers // Mar 2010

    The Future Of Public Debt: Prospects And Implications

    Since the start of the financial crisis, industrial country public debt levels have increased dramatically. And they are set to continue rising for the foreseeable future. A number of countries face the prospect of large and rising future costs related to the ageing of their populations. In this paper, the...

    Provided By Bank for International Settlements

  • White Papers // Mar 2010

    Public Governance Of Central Banks: An Approach From New Institutional Economics

    The governance of central banks has two dimensions: corporate governance and public governance. Public governance is an institutional framework whereby the general public governs a central bank by and through the legislative and executive bodies in a country. This paper argues that the literature of new institutional economics sheds new...

    Provided By Bank for International Settlements

  • White Papers // Mar 2010

    Does Monetary Policy Affect Bank Risk-Taking?

    This paper investigates the relationship between short-term interest rates and bank risk. Using a unique database that includes quarterly balance sheet information for listed banks operating in the European Union and the United States in the last decade, the authors find evidence that unusually low interest rates over an extended...

    Provided By Bank for International Settlements

  • White Papers // Feb 2010

    The Bank Lending Channel Revisited

    A central proposition in research on the role that banks play in the transmission mechanism is that monetary policy imparts a direct impact on deposits and that deposits, insofar as they constitute the supply of loanable funds, act as the driving force of bank lending. This paper argues that the...

    Provided By Bank for International Settlements

  • White Papers // Jan 2011

    Policymaking From A "Macroprudential" Perspective In Emerging Market Economies

    Recurrent capital inflows pose important challenges for authorities in emerging market economies seeking to preserve financial stability. Raising interest rates to dampen imbalances that could arise from capital flows can also attract more capital inflows and accentuate appreciation pressures. This paper reviews some of these instruments, drawing in part on...

    Provided By Bank for International Settlements

  • White Papers // Dec 2009

    Consumption And Real Exchange Rates In Professional Forecasts

    Standard models of international risk sharing with complete asset markets predict a positive association between relative consumption growth and real exchange-rate depreciations across countries. The striking lack of evidence for this link the consumption/realexchange-rate anomaly or Backus-Smith puzzle has prompted research on risk-sharing indicators with incomplete asset markets. That research...

    Provided By Bank for International Settlements

  • White Papers // Dec 2009

    The Risk Of Relying On Reputational Capital: A Case Study Of The 2007 Failure Of New Century Financial

    The quality of newly originated subprime mortgages had been visibly deteriorating for some time before the window for such loans was shut in 2007. Nevertheless, a bankruptcy court's directed ex post examination of New Century Financial, one of the largest originators of subprime mortgages, discovered no change, over time, in...

    Provided By Bank for International Settlements

  • White Papers // Nov 2009

    Ten Propositions About Liquidity Crises

    What are liquidity crises? And what can be done to address them? This short paper brings together some personal reflections on this issue, largely based on previous work. In the process, it questions a number of commonly held beliefs that have become part of the conventional wisdom. The paper is...

    Provided By Bank for International Settlements

  • White Papers // Nov 2009

    Unconventional Monetary Policies: An Appraisal

    The recent global financial crisis has led central banks to rely heavily on "Unconventional" monetary policies. This alternative approach to policy has generated much discussion and a heated and at times confusing debate. The debate has been complicated by the use of different definitions and conflicting views of the mechanisms...

    Provided By Bank for International Settlements

  • White Papers // Nov 2008

    Growing Asian Credit Card Markets Amid The Global Financial Crisis

    Credit card lending in Asia has grown rapidly since the 1997 Asian financial crisis and has much room to expand. But this growth so far has seen several episodes of sharp booms and busts, posing new risks to financial stability. This paper attempts to learn more about the credit card...

    Provided By Bank for International Settlements

  • White Papers // Aug 2011

    Weathering The Financial Crisis: Good Policy Or Good Luck?

    The macroeconomic performance of individual countries varied markedly during the 2007 - 09 global financial crisis. While China's growth never dipped below 6% and Australia's worst quarter was no growth, the economies of Japan, Mexico and the United Kingdom suffered annualised GDP contractions of 5 - 10% per quarter for...

    Provided By Bank for International Settlements

  • White Papers // Feb 2010

    Vendor Models For Credit Risk Measurement And Management

    A number of vendors produce and sell products that are designed to support credit-risk measurement and management functions within financial institutions. Such products may comprise risk measurement models, data, or systems developed by external commercial entities. Interest in such vendor products has grown recently, as financial institutions seek to meet...

    Provided By Bank for International Settlements

  • White Papers // Sep 2010

    Financial System And Macroeconomic Resilience: Revisited

    A last thought to conclude. It took about 60 years to gain a true understanding of the causes and dynamics of the Great Depression. When it comes to this crisis, there is still a long way to go. Our insights into financial transmission mechanisms are partial at best. Although extreme...

    Provided By Bank for International Settlements

  • White Papers // Jan 2011

    The Future Of Central Banking Under Post-Crisis Mandates

    The role of central banks in preserving price stability and fostering financial stability has varied over time and differed across countries. However, at the beginning of the 21st century a number of common features and principal tendencies emerged. The financial crisis has raised important issues with regard to the role...

    Provided By Bank for International Settlements

  • White Papers // Dec 2010

    The Global Crisis And Financial Intermediation In Emerging Market Economies

    The global financial crisis shook the foundations of international banking and finance and put the international banking system under intense stress. Many financial markets became dysfunctional, and many international banks went bankrupt. Although the crisis originated in advanced economies, it quickly moved to emerging market economies (EMEs), particularly in the...

    Provided By Bank for International Settlements

  • White Papers // Jul 2010

    The International Financial Crisis And Policy Challenges In Asia And The Pacific

    This paper addresses financial stability issues in Asia and the Pacific. The keynote address by the author compares the attractiveness of two different models of commercial banking, specifically the Anglo-Saxon model and the Asian model. The author argues that the Anglo-Saxon model imploded during the crisis for good reasons. The...

    Provided By Bank for International Settlements

  • White Papers // Nov 2009

    Globalization, Labor Markets And International Adjustment

    The theme of this paper is the impact of globalization and population trends, in particular various forms of labor mobility, on labor markets and inflation. Of course, labor has always been mobile, to a greater or lesser degree. But for a long while the macroeconomic impact of labor mobility did...

    Provided By Bank for International Settlements

  • White Papers // Dec 2009

    Monetary Policy And The Measurement Of Inflation: Prices, Wages And Expectations

    Inflation measurement is fundamental to the conduct of monetary policy. Price indices form the foundation of central bank policy frameworks around the world. They serve as guides to decision-making, as well as providing the primary mechanism for holding independent policymakers accountable. The purpose of this paper was to explore three...

    Provided By Bank for International Settlements

  • White Papers // May 2009

    Communication Of Monetary Policy Decisions By Central Banks: What Is Revealed And Why

    Central banks around the world have done much in recent years to refine the way they communicate their assessments of economic conditions and their decisions relating to the stance of monetary policy. This has reflected two main factors. First, a global trend towards greater central bank autonomy has been accompanied...

    Provided By Bank for International Settlements

  • White Papers // May 2011

    On Harnessing The Potential Of Financial Inclusion

    The development of information and communications technology is opening up the opportunity for providing essential financial services to most people. Indeed, many mobile money or branchless banking schemes are currently spreading across the world. However, these schemes can only be sustainable if they are built on a commercially viable business...

    Provided By Bank for International Settlements

  • White Papers // May 2011

    Global Imbalances And The Financial Crisis: Link Or No Link?

    Global current account imbalances have been at the forefront of policy debates over the past few years. Many observers have recently singled them out as a key factor contributing to the global financial crisis. Current account surpluses in several emerging market economies are said to have helped fuel the credit...

    Provided By Bank for International Settlements

  • White Papers // Apr 2011

    Dislocations In The Won-Dollar Swap Markets During The Crisis Of 2007-09

    Foreign eXchange (FX) derivatives markets in the Korean won are comparatively thin and vulnerable to impaired functioning. During the crisis, Korea faced dislocations in its FX swap and cross-currency swap markets, so severe that Covered Interest Parity (CIP) between the Korean won and the US dollar was seriously violated. Using...

    Provided By Bank for International Settlements

  • White Papers // Apr 2011

    Market Structures And Systemic Risks Of Exchange-Traded Funds

    Crisis experience has shown that as the financial intermediation chain lengthens, it becomes complicated to assess the risks of financial products due to a lack of transparency as to how risks are managed at different levels of the intermediation chain. Exchange-traded funds, which have become popular among investors seeking exposure...

    Provided By Bank for International Settlements

  • White Papers // Mar 2011

    Measuring The Systemic Importance Of Interconnected Banks

    The authors develop a measure of systemic importance that accounts for the extent to which a bank propagates shocks across the banking system and is vulnerable to propagated shocks. Based on Shapley values, this measure gauges the contribution of interconnected banks to systemic risk, in contrast to other measures proposed...

    Provided By Bank for International Settlements

  • White Papers // Mar 2011

    Securitization Is Not That Evil After All

    A growing number of studies on the US subprime market indicate that, due to asymmetric information, credit risk transfer activities have perverse effects on banks' lending standards. The authors investigate a large part of the market for securitized assets ("Prime mortgages") in Italy, a country with a regulatory framework analogous...

    Provided By Bank for International Settlements

  • White Papers // Feb 2011

    Cyclical Fiscal Policy, Credit Constraints, And Industry Growth

    This paper analyzes the impact of cyclical fiscal policy on industry growth. Using Rajan and Zingales' (1998) difference-in-difference methodology on a panel data sample of manufacturing industries across 15 OECD countries over the period 1980-2005, the authors show that industries with relatively heavier reliance on external finance or lower asset...

    Provided By Bank for International Settlements

  • White Papers // Feb 2011

    Measuring Disagreement In UK Consumer And Central Bank Inflation Forecasts

    The authors provide a new perspective on disagreement in inflation expectations by examining the full probability distributions of UK consumer inflation forecasts based on an adaptive bootstrap multimodality test. Furthermore, they compare the inflation forecasts of the Bank of England's Monetary Policy Committee (MPC) with those of UK consumers, for...

    Provided By Bank for International Settlements

  • White Papers // Feb 2011

    Basel III: Long-Term Impact On Economic Performance And Fluctuations

    The authors assess the long-term economic impact of the new regulatory standards (the Basel III reform), answering the following questions. What is the impact of the reform on long-term economic performance? What is the impact of the reform on economic fluctuations? What is the impact of the adoption of countercyclical...

    Provided By Bank for International Settlements

  • White Papers // Feb 2011

    Macroprudential Policy - A Literature Review

    The recent financial crisis has highlighted the need to go beyond a purely micro approach to financial regulation and supervision. In recent months, the number of policy speeches, research papers and conferences that discuss a macro perspective on financial regulation has grown considerably. The policy debate is focusing in particular...

    Provided By Bank for International Settlements