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A “reverse Robin Hood”? The distributional implications of non-standard monetary policy for Italian households

Marco Casiraghi (), Eugenio Gaiotti (), Lisa Rodano and Alessandro Secchi ()

No 1077, Temi di discussione (Economic working papers) from Bank of Italy, Economic Research and International Relations Area

Abstract: We study empirically the distributional implications of a non-standard monetary policy expansion, considering the measures implemented by the Eurosystem in 2011-2012 and exploiting a rich micro dataset on Italian households’ income and wealth, in order to take contemporaneously into account a number of income- and wealth-related channels. Our results do not support the claim that an unconventional monetary loosening acts as a “reverse Robin Hood”. Larger benefits accrue to households at the bottom of the income scale, as the effects via the stimulus to economic activity and employment outweigh those via financial variables. The response of net wealth is U-shaped: less wealthy households take advantage of their leveraged positions, wealthier households of their larger share of financial assets. Overall, the effects on inequality are negligible. The results also suggest that the risk of an “expropriation of savers” is not likely to materialize, as the decrease in the remuneration of savings is compensated by support to labour income and by capital gains.

Keywords: monetary policy; interest rates; policy effects; inequality (search for similar items in EconPapers)
JEL-codes: E52 E58 I14 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-eur, nep-mac and nep-mon
Date: 2016-07
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