Work detail

Macroprudential regulation of the housing market

Author: Bc. Michal Petrouš
Year: 2016 - summer
Leaders: PhDr. Michal Hlaváček Ph.D.
Consultants:
Work type: Bachelors
Language: English
Pages: 51
Awards and prizes:
Link: https://is.cuni.cz/webapps/zzp/detail/170362/
Abstract: Housing market has a considerable impact on the macroeconomic stability. There
is an attempt to regulate housing market using a set of macroprudential tools. The first
aim of this thesis is to describe and compare macroprudential regulation aiming at the
contract between lenders and borrowers in the European Union and Norway. The
second aim is to assess the influence of central banks in macroprudential policy-making
on the probability that these instruments are implemented. The probability is estimated
using a probit model. The comparison shows that there are considerable differences in
implemented regulation between individual countries and that countries with high
proportion of foreign currency denominated loans use macroprudential measures to
mitigate borrowing in foreign currencies. Using the data from the European union and
Norway, statistically significant influence of central bank involvement was not
identified. The effect of central bank became significant when using larger dataset
including non-European countries. In this dataset, the leading role of central bank is
associated with lower probability that instruments targeting borrowers are
implemented.

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