Household savings constraints,uncertainty and macroprudential policy |
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Authors: | Conor O'Toole Kieran McQuinn Philip Economides |
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Institution: | 1. Economic Analysis Division, Economic and Social Research Institute, Ireland;2. University of Oregon, Eugene, Oregon, USA |
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Abstract: | We investigate the impact of macroprudential policy on Irish households' perception of savings adequacy, with a particular focus on households intending to purchase a home. These measures tighten loan-to-value ratios and raise the entry cost for home purchase. We find that the measures have had a significant impact on savings constraints. Indeed, constrained potential buyers, who are planning to purchase, but not presently saving to buy a home, are the group most affected as the macroprudential rules increase the downpayment size required. Heterogeneous effects across households indicate younger, private renting households, and those with relatively uncertain cash flows. |
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Keywords: | savings uncertainty macroprudential policy |
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