I had the honour of co-editing a special issue of the Journal of Financial Intermediation, just published, comprising
five papers that use granular data to assess the effectiveness of different macro-prudential tools. While macro-prudential regulation has become very prominent over the past decade, following the experience of the Global Financial Crisis, there is still limited
empirical evidence on what works and what does not. Assessing the effect of macroprudential policies is made difficult by two challenges: endogeneity of policy decisions and difficulty of differentiating between demand and supply-side reactions. Using bank-
or loan-level data allows to address these challenges to a certain extent and that is what these five papers are doing. Doing so, however, limits the analysis typically to one country at a time and thus limits the external validity of each study. In the first
paper, however, my special issue co-editor Leonardo Gambacorta and Andres Murcia undertake a meta-analysis of studies by five central banks in Latin America countries (Argentina, Brazil, Colombia, Mexico and Peru) to evaluate the effectiveness of macroprudential
tools and their interaction with monetary policy; they find that macroprudential policies in these five countries have been quite successful in stabilising credit cycles and macroprudential tools have a greater effect on credit growth when reinforced by the
use of monetary policy. Thus interaction of macro-pru and monetary policies is a first important key insight.