A Balance-Sheet Analysis of the Dutch Economy

Author/Editor:

Ruo Chen

Publication Date:

October 22, 2021

Electronic Access:

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Disclaimer: IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.

Summary:

The Dutch economy is characterized by substantial financial balance sheets in the private sector. Uncommonly large gross financial assets and liabilities are found in the financial sector, whereas households own significant net financial wealth. The large gross financial assets and liabilities reflect a dominant role of multinational corporations (MNCs). Despite their size, these financial positions have not brought significant financial stability risks to the country. On the other hand, Dutch households’ long balance sheets have been associated with depressed consumption and volatile real estate investment, which has probably exacerbated the cyclicality of the economy. The expected reform of the pension system is likely to change the way household balance sheets interact with private consumption.

Series:

Working Paper No. 2021/255

Subject:

Frequency:

regular

English

Publication Date:

October 22, 2021

ISBN/ISSN:

9781589068278/1018-5941

Stock No:

WPIEA2021255

Pages:

22

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