Immigrants and the Distribution of Income and Wealth in the Euro Area: First Facts and Implications for Monetary Policy

Dossche, Marteen; Kolndrekaj, Aleksandra; Propst, Maximilian; Perez, Javier Ramos; Slacalek, Jiri

doi:10.2139/ssrn.4219401

Cited by 5 publications

(3 citation statements)

References 22 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…In a similar vein, Furceri, Loungani, and Zdzienicka (2018) find the effect of a monetary policy shock on after‐tax income inequality to be smaller in advanced countries with generous redistribution policy, but larger in those with limited fiscal redistribution. The latter is the case in the U.S. where income redistribution carried out by government is much lower than in most European countries (Dossche, Slačálek, and Wolswijk 2021). Previous studies show that progressive income taxation and government transfers have a dampening effect on income inequality, albeit to a varying degree, conditional on the country's tax systems (see, e.g., Heshmati and Kim 2014, D'Errico, Macchiarelli, and Serafini 2015, Dossche, Slačálek, and Wolswijk 2021).…”

Section: Empirical Analysismentioning

confidence: 96%

“…The latter is the case in the U.S. where income redistribution carried out by government is much lower than in most European countries (Dossche, Slačálek, and Wolswijk 2021). Previous studies show that progressive income taxation and government transfers have a dampening effect on income inequality, albeit to a varying degree, conditional on the country's tax systems (see, e.g., Heshmati and Kim 2014, D'Errico, Macchiarelli, and Serafini 2015, Dossche, Slačálek, and Wolswijk 2021). This suggests—based on our results and in line with the argument of Guerello (2018)—that redistributive fiscal measures may offset the disequalizing effects of monetary policy shocks.…”

Section: Empirical Analysismentioning

confidence: 96%

See 1 more Smart Citation

Does Monetary Policy Affect Income Inequality in the Euro Area?

Samarina¹,

Nguyen²

2023

J of Money Credit Banking

View full text Add to dashboard Cite

This paper examines how the ECB's expansionary monetary policy affects income inequality in 10 euro area countries over the period 1999–2014. We distinguish two channels—labor‐market and financial—through which monetary policy can have distributional effects. The labor‐market channel is captured by wages and employment and the financial channel by asset prices and returns. We find that expansionary monetary policy in the euro area reduces income inequality, especially in the periphery countries. The labor‐market channel enhances the equalizing effect: monetary expansion reduces income inequality stronger by raising wages and employment. There is limited evidence for the financial channel.

show abstract

Section: Empirical Analysismentioning

confidence: 96%

Section: Empirical Analysismentioning

confidence: 96%

Does Monetary Policy Affect Income Inequality in the Euro Area?

Samarina¹,

Nguyen²

2023

J of Money Credit Banking

View full text Add to dashboard Cite

show abstract

“…Companies have used low interest rates to invest, but also to buy their own shares and pay dividends (Cohen et al, 2019). By driving up the price of financial assets and real estate, Europe's asset owners have been amongst the biggest beneficiaries of these programmes (Dossche et al, 2021). Again, the secondary mandate could be brought into play in weighing where and when a bond buying programme is an adequate tool.…”

Section: New Challengesmentioning

confidence: 99%

What to Do with the ECB's Secondary Mandate

Klooster

Boer

2022

J of Common Market Studies

View full text Add to dashboard Cite

The ECB's secondary mandate requires it to support broader economic policies by and in the EU. How should the ECB deal with its many, potentially conflicting, objectives? To answer that question, this article combines normative and legal analysis with new archival sources, as well as analysis of ECB speeches and documents. A more important role for its secondary mandate fits well with the new, more political role of the ECB. However, the requirements that the legal text imposes on the ECB are paradoxical. While strictly binding, the secondary mandate is also highly indeterminate, and the ECB lacks the democratic legitimacy and legal competence to develop its own policies for pursuing the secondary objectives. To resolve this paradoxical situation, we propose that the specification of the ECB's secondary objectives should take place via high-level coordination with the political institutions of the EU.

show abstract