Macroprudential policies and Brexit: A welfare analysis

Brexit will have implications on financial stability and the implementation of macroprudential policies. The United Kingdom (UK) will no longer be subject to the jurisdiction of the European Systemic Risk Board. This paper studies the welfare implications of this change of regime. By means of a dyna...

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Bibliographic Details
Published inEconomic inquiry Vol. 62; no. 3; pp. 1246 - 1267
Main Author Rubio, Margarita
Format Journal Article
LanguageEnglish
Published Huntington Beach Western Economic Association 01.07.2024
Subjects
Brexit
DSGE
Equilibrium
EU membership
Jurisdiction
macroprudential policy
Welfare
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ISSN0095-2583
1465-7295
DOI10.1111/ecin.13214

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Summary:Brexit will have implications on financial stability and the implementation of macroprudential policies. The United Kingdom (UK) will no longer be subject to the jurisdiction of the European Systemic Risk Board. This paper studies the welfare implications of this change of regime. By means of a dynamic stochastic general equilibrium model, I compare the pre‐Brexit scenario with the new one, in which the UK sets macroprudential policy independently. I find that, after Brexit, the UK is better off by setting its own macroprudential policy without taking into account Europe's welfare as a whole.
Bibliography:Managing Editor
Cathy Zhang
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content type line 14
ISSN:0095-2583
1465-7295
DOI:10.1111/ecin.13214