It is optimal for policymakers to use a mix of ex-ante prudential measures and ex-post stimulus measures in response to financial crises risk

Provides a benchmark result for when the spillovers from national economic policymaking are globally efficient

The dynamics of risk-taking in the financial sector are driven by compositional effects, leading to novel effects of financial policy

Macroeconomics would benefit from greater methodological diversity

Studies spillover effects of capital account interventions and implications for policy coordination - cited in the Economist's Free Exchange

A dynamic model of counter-cyclical macro-prudential regulation for credit markets - cited in Economist's Economics Focus, WSJ.com

Foundations for prudential capital controls to reduce the risk of financial crises in emerging economies

Local currency and dollar bonds achieve full insurance in standard small open economy models

Emerging market borrowers take on too much dollar debt because they don't internalize the contribution to financial fragility

Develops a general methodology to categorize & characterize pecuniary externalities from both imperfect risk-sharing and collateral constraints

Note: this paper subsumes my earlier working paper on "Systemic Risk-Taking: Amplification Effects, Externalities, and Regulatory Responses" [2011 ECB WP | 2012 update] and was previously also circulated under the title "Fire-Sale Externalities."

Deleveraging leads to aggregate demand externalities at the ZLB that call for macroprudential regulation - cited in the WSJ

Both instruments are needed in emerging economies that are at risk of financial instability because of large capital inflows

Reserve accumulation may trigger positive learning-by-doing externalities in the tradable sector and improve welfare

Financial deregulation allows the financial sector to extract larger rents from the rest of society

Provides an introduction to quantitive models and the empirics of sudden stops, with ample online resources

A primer that develops a simple formal model of emerging market balance sheet crises, externalities and capital flow regulation

An introduction to the emerging new literature on prudential capital controls in emerging economies, cited in the FT's Economists' Forum and the Economist's Free Exchange

Crises in one area of the world economy cause "hot money" to flow into other areas and create the risk of serial financial crises