Arbeitspapier
Bank Regulation and Sovereign Risk: A Paradox
This paper investigates the impact of banking prudential regulation on sovereign risk. We show that prudential regulation reduces sovereign risk and induces governments to spend more. As a result, countries with tight prudential regulation have lower primary budget balances and accumulate more government debt over time. We find that prudential regulation reduces private debt, while paradoxically increasing government debt. We explore several explanations for this paradox. Our results suggest that prudential regulation enables governments to accumulate debt because they improve the nation's credit rating and its borrowing conditions in sovereign bond markets.
- Sprache
-
Englisch
- Erschienen in
-
Series: CESifo Working Paper ; No. 10434
- Klassifikation
-
Wirtschaft
Monetary Policy
Central Banks and Their Policies
Fiscal Policy
Fiscal Policies and Behavior of Economic Agents: General
Financial Institutions and Services: Government Policy and Regulation
- Thema
-
banking regulation
fiscal policy
macroprudential policy
sovereign debt
sovereign risk
- Ereignis
-
Geistige Schöpfung
- (wer)
-
Afonso, António
Teixeira, André
- Ereignis
-
Veröffentlichung
- (wer)
-
Center for Economic Studies and ifo Institute (CESifo)
- (wo)
-
Munich
- (wann)
-
2023
- Handle
- Letzte Aktualisierung
-
10.03.2025, 11:44 MEZ
Datenpartner
Dieses Objekt wird bereitgestellt von:
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.
Objekttyp
- Arbeitspapier
Beteiligte
- Afonso, António
- Teixeira, André
- Center for Economic Studies and ifo Institute (CESifo)
Entstanden
- 2023
Ähnliche Objekte (12)
Short and long-run behaviour of long-term sovereign bond yields
Long-run determinants of sovereign yields
Sovereign Debt Crisis in Portugal and Spain
Banks' Portfolio of Government Debt and Sovereign Risk
Level, slope, curvature of the sovereign yield curve, and fiscal behaviour
Stock flow adjustments in sovereign debt dynamics: the role of fiscal frameworks
What do we really know about fiscal sustainability in the EU? A panel data diagnostic
A Note on Public Spending Efficiency
Portugal's GDP, a note on the 2020 unknowns
Expansionary fiscal consolidations in Europe: new evidence
Ricardian fiscal regimes in the European Union
Sustainability of fiscal policy in the EU-15
Short and long-run behaviour of long-term sovereign bond yields
Long-run determinants of sovereign yields
Sovereign Debt Crisis in Portugal and Spain
Banks' Portfolio of Government Debt and Sovereign Risk
Level, slope, curvature of the sovereign yield curve, and fiscal behaviour
Stock flow adjustments in sovereign debt dynamics: the role of fiscal frameworks
What do we really know about fiscal sustainability in the EU? A panel data diagnostic
A Note on Public Spending Efficiency
Portugal's GDP, a note on the 2020 unknowns
Expansionary fiscal consolidations in Europe: new evidence
Ricardian fiscal regimes in the European Union
Sustainability of fiscal policy in the EU-15
Short and long-run behaviour of long-term sovereign bond yields
Long-run determinants of sovereign yields
Sovereign Debt Crisis in Portugal and Spain
Banks' Portfolio of Government Debt and Sovereign Risk
Level, slope, curvature of the sovereign yield curve, and fiscal behaviour
Stock flow adjustments in sovereign debt dynamics: the role of fiscal frameworks
What do we really know about fiscal sustainability in the EU? A panel data diagnostic
A Note on Public Spending Efficiency
Portugal's GDP, a note on the 2020 unknowns
Expansionary fiscal consolidations in Europe: new evidence
Ricardian fiscal regimes in the European Union