A new SEACEN working paper, by Victor Pontines, adds to a recent and growing literature that assesses the effects of macroprudential policy. The effects of LTV ratio shocks in Korea were identified using sign-restricted structural VARs and rely on a recent approach within this method to conduct structural inference. The findings show that LTV ratio shocks have effects on different measures of credit (i.e., real bank credit, real total credit and real household credit), real house prices, real output, real consumption and real investment. However, LTV ratio shocks have negligible effects on the price level.
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