Business, Management and Accounting
4 years ago

Monetary policy impacts inequality: new study reveals distributive effects.

MPRA Paper
Monetary policy and inequality under household heterogeneity and incomplete markets
Francisco G. Villarreal

Paper Summary

The article explores how monetary policy affects inequality among households by using a model that considers different types of households facing different risks. The model, based on data from Mexico, shows that household differences impact how monetary policy influences the economy. The study finds that the design of monetary policy can have significant effects on income and wealth distribution.

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