Phasing in Basel III rules eases economic costs: IMF paper
The macroeconomic costs associated with raising capital and liquidity requirements are moderate if phased in over an extended period of time, an International Monetary Fund paper, published on Wednesday, said.
Scott Roger and Jan Vlček, the paper's authors, use a dynamic stochastic general equilibrium with banks and financial frictions in credit markets to assess the medium-term macroeconomic costs of increasing capital and liquidity requirements.
Roger and Vlček find evidence that suggests the
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