Going forward, analytical frameworks also need to take these elements into account. Macro-prudential policy: Implementation issues and effectiveness It is worthwhile to group macro-prudential policies into two categories according to the way they operate. A simple distinction can be made between measures that act through cost-price incentives, like capital requirements, and those that depend on quantitative limits, like large exposures or LTV/DTIs limits.
Capital based instruments act to restrain the boom as long as banks’ overall cost of funds is sensitive to the structure of its liabilities. We know  15  Since countries with more credit booms also experienced more crises (on average), there seems to be a trade-off between macroeconomic performance and stability (Rancière, Tornell, and Westermann, 2008).