The inequality channel of monetary transmission |
| |
| Affiliation: | 1. Central Bank of Brazil, Research Department, Rio de Janeiro, RJ, Brazil;2. Pontifical Catholic University of Rio de Janeiro, Department of Economics, Rio de Janeiro, RJ, Brazil;1. Management and Organizational Studies, Faculty of Social Science, The University of Western Ontario, London, Ontario, Canada N6A 5C2;2. Department of Psychology, Faculty of Humanities and Social Sciences, University of Zagreb, Croatia;3. Centre for Educational Research and Development, Institute for Social Research, Zagreb, Croatia |
| |
| Abstract: | We examine optimal monetary policy in the presence of inequality by introducing unskilled agents with no access to the financial system into a DSGE model with sticky prices. Our main results are: (i) a contractionary interest rate shock increases inequality, while inflation and the output gap fall; (ii) the welfare-based objective of monetary policy includes inequality stabilization; (iii) as the proportion of unskilled agents increases, welfare decreases; and (iv) under scarcity of skilled agents, monetary policy is weakened, while fiscal policy produces a more relevant impact on the economy. |
| |
| Keywords: | |
| 本文献已被 ScienceDirect 等数据库收录！ |
|
