Monetary policy transmission and income inequality in Sub-Saharan Africa
Tóm tắt
This paper evaluates the monetary policy transmission and income inequality in Sub-Saharan Africa (SSA) countries. We find procyclical response of income inequality to unanticipated monetary easing in the last two decades. Countercyclical monetary measures may have been efficient, but they have been dis-equalising as well. Taking cognisance of the explanations of the earnings heterogeneity channel, this evidence signals high concentration of assets and resources, limited employment of labour and limited distributive capacity of the state in SSA countries. Economic outturns may have favoured chiefly, the top of the distribution—entrepreneurs and their profit margin. Three main channels distinguish the transmission of standard and non-standard monetary measures: the reaction in the stock market, the response of the exchange rate and the fiscal response. The evidence demonstrates that the fiscal reaction to monetary policy action is important to the overall transmission of monetary policy to macroeconomic aggregates. Instructively, we find that the inflation cost of countercyclical monetary measures is comparatively less severe for standard monetary measures than non-standard monetary actions.
Tài liệu tham khảo
Albanesi S (2007) Inflation and inequality. J Monet Econ 54(4):1088–1114
Ampudia M, Georgarakos D, Slacalek J, Tristani O, Vermeulen P, Violante G (2018) Monetary policy and household inequality. ECB Working Paper No. 2170. https://doi.org/10.7910/DVN/IGNPDZ
Ankargren S, Jonéus P (2019) Estimating large mixed-frequency Bayesian VAR models. Available at: http://arxiv.org/abs/1912.02231
Areosa WD, Areosa MBM (2016) The inequality channel of monetary transmission. J Macroecon 48:214–230. https://doi.org/10.1016/j.jmacro.2016.03.004
Auclert A (2019) Monetary policy and the redistribution channel. Am Econ Rev. https://doi.org/10.1257/aer.20160137
Berg A, Ostry JD, Tsangarides CG, Yakhshilikov Y (2018) Redistribution, inequality, and growth: new evidence. J Econ Growth 23(3):259–305
Bernanke BS (2012) Opening remarks: monetary policy since the onset of the crisis. In: Proceedings: economic policy symposium Jackson hole, vol 1, p 22
Calza A, Monacelli T, Stracca L (2013) Housing finance and monetary policy. J Eur Econ Assoc 11:101–122
Christiano LJ, Eichenbaum M, Evans CL (1999) Monetary policy shocks: What have we learned and to what end? Handb Macroecon 1:65–148
Christiano LJ, Eichenbaum M, Evans CL (2005) Nominal rigidities and the dynamic effects of a shock to monetary policy. J Polit Econ 113(1):1–45. https://doi.org/10.1086/426038
Cloyne J, Ferreira C, Surico P (2020) Monetary policy when households have debt: New evidence on the transmission mechanism. Rev Econ Stud 87(1):102–129
Coibion O, Gorodnichenko Y, Kueng L, Silvia J (2017) Innocent bystanders? Monetary policy and inequality. J Monet Econ 88:70–89. https://doi.org/10.1016/j.jmoneco.2017.05.005
Colciago A, Samarina A, de Haan J (2019) Central Bank policies and income and wealth inequality: a survey. J Econ Surv 33(4):1199–1231. https://doi.org/10.1111/joes.12314
Dabla-Norris ME, Kochhar MK, Suphaphiphat MN, Ricka MF, Tsounta E (2015) Causes and consequences of income inequality: a global perspective. International Monetary Fund
Davtyan K (2017) The distributive effect of monetary policy: the top one percent makes the difference. Econ Model 65:106–118. https://doi.org/10.1016/j.econmod.2017.05.011
Doepke M, Schneider M (2006) Inflation and redistribution of nominal wealth. J Polit Econ 114(6):1069–1097
Dolado JJ, Motyovszki G, Pappa E (2018) Monetary policy and inequality under labor market frictions and capital-skill complementarity (No. 11494). Institute for the Study of Labor (IZA)
Domanski D, Scatigna M, Zabai A (2016) Wealth inequality and monetary policy. BIS Q Rev March
Draghi M (2015) The ECB’s recent monetary policy measures: effectiveness and challenges. Available at: https://www.ecb.europa.eu/press/key/date/2015/html/sp150514.en.html
Easterly W, Fischer S (2001) Inflation and the poor. J Money Credit Bank 33:160–178
Foroni C, Marcellino MG (2013) A survey of econometric methods for mixed-frequency data. SSRN Electron J. https://doi.org/10.2139/ssrn.2268912
Friedman M (1968) The role of monetary policy. Am Econ Rev 58(1):1–17
Furceri D, Loungani P, Zdzienicka A (2018) The effects of monetary policy shocks on inequality. J Int Money Finance 85:168–186. https://doi.org/10.1016/j.jimonfin.2017.11.004
Galbraith JK, Giovannoni O, Russo AJ (2007) The fed's real reaction function: monetary policy, inflation, unemployment, inequality-and presidential politics. Levy Economics Institute. http://www.levyinstitute.org/pubs/wp_511.pdf
Galli R, von der Hoeven R (2001) Is inflation bad for income inequality: the importance of the initial rate of inflation. ILO Employment Paper 2001/29, International Labour Organization, Geneva
Guerello C (2018) Conventional and unconventional monetary policy vs. households income distribution: an empirical analysis for the Euro Area. J Int Money Finance 85:187–214. https://doi.org/10.1016/j.jimonfin.2017.11.005
Hnatkovska V, Lahiri A, Vegh CA (2016) The exchange rate response to monetary policy innovations. Am Econ J Macroecon 8(2):137–181
Inui M, Sudo N, Yamada T (2017) Effects of monetary policy shocks on inequality in Japan, Bank of Japan Working Paper Series. https://doi.org/10.5089/9781475563092.001
Kang SJ, Chung YW, Sohn SH (2013) The effects of monetary policy on individual welfares. Korea World Econ 14(1):1–29
Kaplan G, Moll B, Violante GL (2018) Monetary policy according to HANK. Am Econ Rev 108(3):697–743. https://doi.org/10.1257/aer.20160042
Lenza M, Slacalek J (2018) How does monetary policy affect income and wealth inequality? Evidence from the Euro Area, Mimeo, European Central Bank, Frankfurt am Main
Lütkepohl H, Krätzig M, Phillips PC (eds) (2004) Applied time series econometrics. Cambridge University Press. https://doi.org/10.1017/CBO9781107415324.004
Matthes C, Barnichon R (2015) Measuring the non-linear effects of monetary policy. In: 2015 Meeting papers (No. 49). Society for Economic Dynamics
Montecino JA, Epstein G (2015) Did quantitative easing increase income inequality? Working Paper 28, Institute for New Economic Thinking, New York
Mumtaz H, Theophilopoulou A (2017) The impact of monetary policy on inequality in the UK. An empirical analysis. Eur Econ Rev 98:410–423. https://doi.org/10.1016/j.euroecorev.2017.07.008
Odusola AF et al (eds) (2017) Income inequality trends in sub-Saharan Africa: divergence, determinants and consequences. United Nations Development Programme, Regional Bureau for Africa
Rogers JH, Scotti C, Wright JH (2014) Evaluating asset-market effects of unconventional monetary policy: a multi-country review. Econ Policy 29(80):749–799
Rubio-Ramírez JF, Waggoner DF, Zha T (2010) Structural vector autoregressions: theory of identification and algorithms for inference. Rev Econ Stud 77(2):665–696. https://doi.org/10.1111/j.1467-937X.2009.00578.x
Saiki A, Frost J (2014) Does unconventional monetary policy affect inequality? Evidence from Japan. Appl Econ 46(36):4445–4454. https://doi.org/10.1080/00036846.2014.962229
Samarina A, Nguyen ADM (2019) Does monetary policy affect income inequality in the Euro area?, DNB Working Paper. https://doi.org/10.2139/ssrn.3352371
Seery E, Okanda J, Lawson M (2019) A tale of two continents: fighting inequality in Africa. Oxfam. https://doi.org/10.4337/9781781956168.00015
Sims AC, Stock JH, Watson MW (1990) Inference in linear time series models with some unit roots. Econometrica 58(1):113–144
Sterk V, Tenreyro S (2018) The transmission of monetary policy through redistributions and durable purchases. J Monet Econ 99:124–137. https://doi.org/10.1016/j.jmoneco.2018.07.003
Uhlig H (2005) What are the effects of monetary policy on output? Results from an agnostic identification procedure. J Monet Econ 52(2):381–419. https://doi.org/10.1016/j.jmoneco.2004.05.007