Navigating the well-being effects of monetary policy: Evidence from the European Central Bank

Mehdi El Herradi () and Aurélien Leroy

Bordeaux Economics Working Papers from Bordeaux School of Economics (BSE)

Abstract: This paper assesses whether monetary policy announcements have an impact on households’ (subjective) well-being by analysing life satisfaction on the days before and after monetary surprises in Germany. To do so, we use individual-level information on life satisfaction from the German Socio-Economic Panel (SOEP) survey and identify the day on which each answer is submitted to the survey. We also exploit the Euro Area Monetary Policy event study Database (EA-MPD) to obtain daily-level information on European Central Bank (ECB) monetary surprises. Our results show that life satisfaction is significantly affected by monetary policy surprises: tightening surprises decrease life satisfaction, while easing surprises increase it.

Keywords: Monetary policy; Subjective Well-Being; Survey data; European Central Bank (search for similar items in EconPapers)
JEL-codes: E52 E58 I31 (search for similar items in EconPapers)
Date: 2022
New Economics Papers: this item is included in nep-ban, nep-cba, nep-eec, nep-eur, nep-hap and nep-mon
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Working Paper: Navigating the well-being effects of monetary policy:Evidence from the European Central Bank (2022)
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Persistent link: https://EconPapers.repec.org/RePEc:grt:bdxewp:2022-09

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