Frache, Serafin; Garcia-Cicco, Javier; Ponce, Jorge - In: Latin American journal of central banking : LAJCB 4 (2023) 3, pp. 1-25
We developed a dynamic stochastic general equilibrium (DSGE) model for a small, open economy with a banking sector and … endogenous default to assess two macroprudential tools: countercyclical capital buffers (CCB) and dynamic provisions (DP). The … model is estimated with data for Uruguay, where dynamic provisioning has existed since the early 2000s. Both tools force …