interactions between micro-prudential and macro-prudential policies. We find that the model can replicate new stylized facts … suggest that the economic system at large can benefit from the introduction of a micro-prudential regulation that takes into … emerge in a two-pillar regulatory framework grounded on i) a Basel III macro-prudential regulation and ii) a NEVA-based micro-prudential …

interactions between micro-prudential and macro-prudential policies. We find that the model can replicate new stylized facts … suggest that the economic system at large can benefit from the introduction of a micro-prudential regulation that takes into … emerge in a two-pillar regulatory framework grounded on i) a Basel III macro-prudential regulation and ii) a NEVA-based micro-prudential …

paper, by means of a DSGE model including heterogeneous firms and banks, financial frictions and prudential regulation …, first shows the need of climate-related capital requirements in the existing prudential framework. Indeed, we find that … without specific climate prudential policies, transition risk can generate excessive risk-taking by banks, which in turn …