An empirical assessment of monetary policy channels on income and wealth disparities

Detalhes bibliográficos
Autor(a) principal: Alves, José
Data de Publicação: 2020
Outros Autores: Silva, Tomás
Tipo de documento: Artigo
Idioma: eng
Título da fonte: Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos)
Texto Completo: http://hdl.handle.net/10400.5/20408
Resumo: Our paper aims at analysing the relation between monetary policy and its transmission channels on both income and wealth inequality for the Euro Area. We analysed three different channels identified by the literature (Income, Portfolio and Earnings Heterogeneity) that might explain how monetary policy decisions may affect wealth and income distribution. In this empirical research we also set up a fourth regression combining all our selected explanatory variables with the goal of studying the impact of the aforementioned channels combined. For income inequality we analysed four different measures, namely Gini of disposable income (GDI), Gini of market income (GMI), share of income held by the top 1% and the share of income of the top 10% of society. In what regards to wealth inequality due to lack of data we had to create an alternative measure that can both translate the unequal savings rate of the Euro Area countries and evaluate the pace of capital accumulation in order to shed a light on the gap between high-income and low-income household’s annual savings. So that our study could be conducted we developed an unbalanced panel data analysis for the Eurozone countries between 1999 and 2017. The results we reached led us to conclude that the increase in asset prices, mainly equity, seems to be relevant to explain an increase in income inequality. However, it seems that the positive impact that MP had on unemployment by reducing it, contributed to avoid a higher increase on income inequality in the Euro Area.
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spelling An empirical assessment of monetary policy channels on income and wealth disparitiesIncome inequalitiesWealth inequalitiesMonetary PolicyTransmission ChannelsOur paper aims at analysing the relation between monetary policy and its transmission channels on both income and wealth inequality for the Euro Area. We analysed three different channels identified by the literature (Income, Portfolio and Earnings Heterogeneity) that might explain how monetary policy decisions may affect wealth and income distribution. In this empirical research we also set up a fourth regression combining all our selected explanatory variables with the goal of studying the impact of the aforementioned channels combined. For income inequality we analysed four different measures, namely Gini of disposable income (GDI), Gini of market income (GMI), share of income held by the top 1% and the share of income of the top 10% of society. In what regards to wealth inequality due to lack of data we had to create an alternative measure that can both translate the unequal savings rate of the Euro Area countries and evaluate the pace of capital accumulation in order to shed a light on the gap between high-income and low-income household’s annual savings. So that our study could be conducted we developed an unbalanced panel data analysis for the Eurozone countries between 1999 and 2017. The results we reached led us to conclude that the increase in asset prices, mainly equity, seems to be relevant to explain an increase in income inequality. However, it seems that the positive impact that MP had on unemployment by reducing it, contributed to avoid a higher increase on income inequality in the Euro Area.ISEG - REM - Research in Economics and MathematicsRepositório da Universidade de LisboaAlves, JoséSilva, Tomás2020-09-29T16:47:46Z2020-092020-09-01T00:00:00Zinfo:eu-repo/semantics/publishedVersioninfo:eu-repo/semantics/articleapplication/pdfhttp://hdl.handle.net/10400.5/20408engAlves, José e Tomás Silva (2020). "An empirical assessment of monetary policy channels on income and wealth disparities". Instituto Superior de Economia e Gestão – REM Working paper nº 0144 – 20200144-2020info:eu-repo/semantics/openAccessreponame:Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos)instname:Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informaçãoinstacron:RCAAP2023-03-06T14:49:50Zoai:www.repository.utl.pt:10400.5/20408Portal AgregadorONGhttps://www.rcaap.pt/oai/openaireopendoar:71602024-03-19T17:05:10.016619Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos) - Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informaçãofalse
dc.title.none.fl_str_mv An empirical assessment of monetary policy channels on income and wealth disparities
title An empirical assessment of monetary policy channels on income and wealth disparities
spellingShingle An empirical assessment of monetary policy channels on income and wealth disparities
Alves, José
Income inequalities
Wealth inequalities
Monetary Policy
Transmission Channels
title_short An empirical assessment of monetary policy channels on income and wealth disparities
title_full An empirical assessment of monetary policy channels on income and wealth disparities
title_fullStr An empirical assessment of monetary policy channels on income and wealth disparities
title_full_unstemmed An empirical assessment of monetary policy channels on income and wealth disparities
title_sort An empirical assessment of monetary policy channels on income and wealth disparities
author Alves, José
author_facet Alves, José
Silva, Tomás
author_role author
author2 Silva, Tomás
author2_role author
dc.contributor.none.fl_str_mv Repositório da Universidade de Lisboa
dc.contributor.author.fl_str_mv Alves, José
Silva, Tomás
dc.subject.por.fl_str_mv Income inequalities
Wealth inequalities
Monetary Policy
Transmission Channels
topic Income inequalities
Wealth inequalities
Monetary Policy
Transmission Channels
description Our paper aims at analysing the relation between monetary policy and its transmission channels on both income and wealth inequality for the Euro Area. We analysed three different channels identified by the literature (Income, Portfolio and Earnings Heterogeneity) that might explain how monetary policy decisions may affect wealth and income distribution. In this empirical research we also set up a fourth regression combining all our selected explanatory variables with the goal of studying the impact of the aforementioned channels combined. For income inequality we analysed four different measures, namely Gini of disposable income (GDI), Gini of market income (GMI), share of income held by the top 1% and the share of income of the top 10% of society. In what regards to wealth inequality due to lack of data we had to create an alternative measure that can both translate the unequal savings rate of the Euro Area countries and evaluate the pace of capital accumulation in order to shed a light on the gap between high-income and low-income household’s annual savings. So that our study could be conducted we developed an unbalanced panel data analysis for the Eurozone countries between 1999 and 2017. The results we reached led us to conclude that the increase in asset prices, mainly equity, seems to be relevant to explain an increase in income inequality. However, it seems that the positive impact that MP had on unemployment by reducing it, contributed to avoid a higher increase on income inequality in the Euro Area.
publishDate 2020
dc.date.none.fl_str_mv 2020-09-29T16:47:46Z
2020-09
2020-09-01T00:00:00Z
dc.type.status.fl_str_mv info:eu-repo/semantics/publishedVersion
dc.type.driver.fl_str_mv info:eu-repo/semantics/article
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status_str publishedVersion
dc.identifier.uri.fl_str_mv http://hdl.handle.net/10400.5/20408
url http://hdl.handle.net/10400.5/20408
dc.language.iso.fl_str_mv eng
language eng
dc.relation.none.fl_str_mv Alves, José e Tomás Silva (2020). "An empirical assessment of monetary policy channels on income and wealth disparities". Instituto Superior de Economia e Gestão – REM Working paper nº 0144 – 2020
0144-2020
dc.rights.driver.fl_str_mv info:eu-repo/semantics/openAccess
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dc.publisher.none.fl_str_mv ISEG - REM - Research in Economics and Mathematics
publisher.none.fl_str_mv ISEG - REM - Research in Economics and Mathematics
dc.source.none.fl_str_mv reponame:Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos)
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