Project information
Interactions of Macroeconomic Policies in Different Economic Contexts

Analyzing the interactions between monetary, fiscal, and macroprudential policies is essential to understanding how policy decisions impact the overall economy and financial system. It can help policymakers identify potential conflicts and trade-offs between policies and design policy packages that are more effective in achieving macroeconomic goals. It can also inform the development of more comprehensive and coordinated policy frameworks that consider the interdependencies between the policies. The literature generally agrees on the existence of important feedback loops between individual macroeconomic policies. Using the local projections method developed by Jorda (2005) we plan to study cross-border spillovers of macroeconomic policies. Additionally, we intend to study the interactions of the macroeconomic policies underlying processes. The study will be an international panel study and a single-country perspective studying how monetary policy regime switches (e.g., loose to tight policy) impact the effectiveness of macroprudential policy tools.