Five Facts about the Distributional Income Effects of Monetary Policy

Niklas Amberg, Thomas Jansson, Mathias Klein and Anna Rogantini Picco

No 9062, CESifo Working Paper Series from CESifo

Abstract: We use Swedish administrative individual-level data to document five facts about the distributional income effects of monetary policy. (i) The effects of monetary policy shocks are U-shaped with respect to the income distribution—i.e., expansionary shocks increase the incomes of high- and low-income individuals relative to middle-income individuals. (ii) The large effects in the bottom are accounted for by the labor-income response and (iii) those in the top by the capital-income response. (iv) The heterogeneity in the labor-income response is due to the earnings heterogeneity channel, whereas (v) that in the capital-income response is due to the income composition channel.

Keywords: monetary policy; income inequality; heterogeneous agents; administrative data (search for similar items in EconPapers)
JEL-codes: C55 E32 E52 (search for similar items in EconPapers)
Date: 2021
New Economics Papers: this item is included in nep-cba, nep-cwa, nep-mac, nep-mon and nep-ore
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (13)

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Working Paper: Five Facts about the Distributional Income Effects of Monetary Policy (2021)
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