What are the quantitative effects of countercyclical capital buffers (CCyB)? I study this question in the context of a nonlinear DSGE model with a financial sector that is subject to occasional panics. A calibrated version of the model is combined with US data to estimate sequences of structural...

What are the quantitative macroeconomic effects of the countercyclical capital buffer (CCyB)? I study this question in a nonlinear DSGE model with occasional financial crises, which is calibrated and combined with US data to estimate sequences of structural shocks. Raising capital buffers during...

This paper analyzes banking crises using a quantitative model with equilibrium default for both firms and banks. The main results are: 1) small open economies have larger banking crises than closed or large economies. Constant international rates do not mitigate interbank spreads and amplify...

Recent economic developments highlight Latin America's vulnerability to economic and financial turmoil that is triggered by events in distant corners of the globe. The Asian financial crisis that began in 1997 and the Russion crisis have left the region profoundly shaken and fearful of a...

This paper investigates the impact of the history of crises on macroeconomic performance. We first study the impact of past banking crises on the probability of a future banking crisis. Applying data for 1980 - 2010 for all countries for which the required information is available, controlling...

This paper examines five possible explanations for the Great Recession of 2008 and 2009, using data for the United States and the eurozone. Of these five hypotheses, four are not supported by the data, while the fifth appears reasonable.