International Economics Proposal for a special issue of International Economics Macroprudential Policy: New Challenges

Guest Editors:

Camille Cornand (GATE-LSE)

Cyriac Guillaumin (University Grenoble Alpes)

Julien Idier (Bank of France)

Subject

The 2008-2009 Great Financial Crisis (GFC) was unprecedented because of both its size and its duration. Some feel it is akin to the 1929 crisis and yet even more severe, especially because of growing financial integration, deregulation, and financial innovations. In particular, the role of interconnexions within the entire financial system and the widespread impact of the GFC on the financing of the economies has shown that regulating one-by-one financial intermediaries (which is the objective of microprudential policies) is insufficient. Macroprudential policies aim at complementing this approach to ensure financial stability as a whole and sustainable financing of the economy.

This crisis foreshadows future financial difficulties, caused especially today by excess liquidity that could lead to the formation of a new bubble in financial markets. All the dysfunctions observed on the financial markets over the past ten years call for a radical renewal of our conception of the regulation of the financial system, in particular by complementing it with a macroprudential approach. Indeed, while the macroprudential framework is not new, it has returned to the forefront through the emergence of numerous instruments, at both the macro and micro levels, in response to global financial instability.

It is now a key question to evaluate the effectiveness of these instruments, especially in light of current market developments in Europe, the United States, and emerging markets. Furthermore, Covid-19 pandemic is a major disruptive event for the global economy and appears as an important financial and real shock. It is revealing financial vulnerabilities and testing the post-financial crisis economic system.

Each crisis should be the occasion to revise our paradigms: 1929 crisis, GFC or Covid-19, are major disruptive that serve as a wake-up call for researchers and policy-makers to evaluate the resilience of our economic and financial system and, more specifically, the appropriateness and sufficiency of macroprudential policies.

The purpose of this special issue of International Economics (https://www.journals.elsevier.com/international-economics) is to enable researchers to present research work, both theoretical and/or empirical, on macroprudential policy.

Possible topics include, but are not necessarily limited to, the following:

• Definition and implementation of macroprudential policy: objective, scope, instruments, institutional organization, analytical framework
• Effectiveness of the instruments targeting asset price misalignments, liquidity risk, excessive leverage or concentration
• Design and implementation of macroprudential policies beyond banks
• Interaction and coordination between economic policies (monetary and/or fiscal) and prudential policies (micro and/or macroprudential)
• Integration of the banking and financial sectors into the macroeconomic models of central banks, in particular the integration of financial frictions
• Microeconomic foundations of macroprudential policy
• Interactions between microprudential and macroprudential regulations
• Financial cycles and business cycles
• Policy measures in response to the Covid-19: implications for the financial system, impact on the real economy

Submission procedure

Full paper (in English) must be submitted on International Economics Elsevier’s platform: https://www.journals.elsevier.com/international-economics

All submissions will be sent to a minimum of two independent reviewers to assess the scientific quality of the paper. Editors and Guest Editors are responsible for the final decision regarding acceptance or rejection of articles.

Important dates

Opening submission: October 1^st, 2020

Submission deadline: January 31^st, 2021

First decision on submission: March 30^th, 2021

Special issue publication: Autumn 2021

https://www.journals.elsevier.com/international-economics/call-for-papers/macroprudential-policy-new-challenges