This paper examines the procyclical effect of risk-sensitive capital regulation on bank lending. We find evidence that sensitivity lending to GDP is significantly positive under internal rating-based approach. Our findings show requirements Basel II and III regulations have effects in nine European countries. The introduction requirement rule negatively impacts these policy implication regulato...

Labor productivity is more procyclical in OECD countries with lower employment volatility. To capture this new stylized fact, we propose a business cycle model adjustment costs, variable hours and labor effort. We show that, our effort, greater market frictions are associated as well stable employment. In contrast, the constant-effort fails to replicate observed cross-country pattern data. By i...

As part of the regional integration process, East African Community (EAC) member countries agreed upon macroeconomic convergence criteria that include, among others, harmonizing and restricting level fiscal deficits. However, achieving these targets has been faced with heightened vulnerabilities, including those related to global financial crisis, COVID-19 pandemic, domestic policy slippages. C...