Monetary Policy and Inequality

Co-organized with the Federal Reserve Bank of Atlanta
Atlanta, United States

  • The Council on Economic Policies (CEP) and the Federal Reserve Bank of Atlanta organized a workshop on Monetary Policy and Inequality on 3-4 April 2014 at the Federal Reserve Bank of Atlanta.

    Since the beginning of the 1990s, income and wealth inequality has been rising in most economies (see, e.g., Atkinson, Piketty and Saez, 2011). Several factors are claimed to be at the roots of this drift; however, even after taking them into account, a large part of the growing gap between high and low incomes or wealth remains unexplained (Bulir, 2001).

    Some recent literature examines the role that monetary policy may play in this development (see, e.g., Coibion, Gorodnichenko, Kueng and Silvia, 2012). In addition, central banks are increasingly asked by public stakeholders to evaluate the distributive impacts of monetary policy. Yet, economic research today is too scarce to provide a comprehensive answer.

    Against this background, the goal of this workshop was to convene academics and monetary policy practitioners to present their current research on the link between monetary policy and inequality in order to better understand the connection between them.

    Workshop Committee

    • Tiago Berriel, Pontifical University of Rio de Janeiro
    • Paola Boel, Sveriges Riksbank
    • Michael Bryan, Federal Reserve Bank of Atlanta
    • Davide Furceri, International Monetary Fund
    • Rossana Galli, University of Lugano, Switzerland
    • Pierre Monnin, Council on Economic Policies
    • John Robertson, Federal Reserve Bank of Atlanta
    • Robert Triest, Federal Reserve Bank of Boston

  • 3 April 2014

    07:30Breakfast and registration
    Session 1: Inflation and Inequality—Empirics
    08:00Inequality in the Welfare Costs of Disinflation
    Presenter: Benjamin Pugsley, Federal Reserve Bank of New York
    Discussant: Juan Rubio-Ramirez, Duke University
    09:00Inflation and Income Inequality in U.S. States
    Presenter: Oguzhan Dincer, Illinois State University
    Discussant: Robert Triest, Federal Reserve Bank of Boston
    10:30Inflation and the Rich after the Global Financial Crisis
    Presenter: Branimir Jovanovic, National Bank of the Republic of Macedonia (Paper)
    Discussant: Junyi Zhu, Deutsche Bundesbank
    Session 2: Inflation and Inequality—Theory
    11:30On the Distributive Effects of Inflation
    Presenter: Charles Gottlieb, University of Oxford Nuffield College
    Discussant: Takemasa Oda, Bank of Japan
    13:30Redistributive Effects of Inflation in a Model of Money and Capital
    Presenter: Paola Boel, Sveriges Riksbank
    Discussant: Sam Schulhofer-Wohl, Federal Reserve Bank of Minneapolis
    Session 3: Conventional and Unconventional Monetary Policy and Inequality
    14:30Trickle-Down Consumption, Monetary Policy, and Inequality
    Presenter: Marco Airaudo, Drexel University (Paper)
    Discussant: Pierre Monnin, Council on Economic Policies
    16:00How Monetary Policy Has Contributed to the Income Inequality in Japan
    Presenter: Jon Frost and Ayako Saiki, De Nederlandsche Bank (Slides) (Paper)
    Discussant: Anton Braun, Federal Reserve Bank of Atlanta
    Reception and Dinner
    18:15Dinner with presentation
    QE and Ultra-Low Interest Rates: Distributional Effects and Risks
    Ari Shwayder, McKinsey Global Institute (Report)

    4 April 2014

    Session 1: Monetary Policy and Inequality in Developing Countries
    08:00Does Monetary Policy Really Affect Poverty?
    Presenter: Simon Yannick Fouda Ekobena, University of Yaounde (Paper)
    Discussant: Chris Cunningham, Federal Reserve Bank of Atlanta
    09:00Distributional Effects of Monetary Policy in Developing Countries
    Presenter: Boyang Zhang, Cornell University
    Discussant: Federico Mandelman, Federal Reserve Bank of Atlanta
    Session 2: Optimal Monetary Policy and Inequality
    10:30Doves for the Rich, Hawks for the Poor? Distributional Consequences of Monetary Policy
    Presenter: Makoto Nakajima, Federal Reserve Bank of Philadelphia (Paper)
    Discussant: Arlene Wong, Northwestern University
    11:30The Duel of the Dual Mandate
    Presenter: Yongseok Shin, Washington University and Federal Reserve Bank of St. Louis
    Discussant: Anastasios Karantounias, Federal Reserve Bank of Atlanta
    Session 3: Monetary Policy and Inequality—Lessons and Milestones
    13:30Monetary Policy and Inequality: Lessons from the Workshop
    Presenter: Pierre Monnin, Council on Economic Policies
    14:00Monetary Policy and Inequality: Milestones for the Next 12 Months