Lights on the Shadows: Exploring the Need for Regulation in Shadow Banking
Posted: 30 Apr 2018
Date Written: October 31, 2017
Using an instrument-based definition of shadow banking, we investigate the size and evolution over time of the shadow banking system. We investigate data on Asset Backed Commercial Paper and Securitized Real Estate Loan with an original approach. By means of several advanced and refined econometric tests, we explore time series data and find a non-stationary trend. This provides support for the need to regulate shadow banking. Further policy implications are discussed in detail.
Keywords: shadow banking system; financial intermediation; Asset Backed Commercial Paper; Securitized Real Estate Loan; time series analysis
JEL Classification: E51, F34, G01, G21, G23
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