The distributional effects of monetary policy since the Great Financial Crisis: A literature review

Bc. Gustav Svedberg

Master's thesis

Abstract:

This thesis aimed to undertake a comprehensive literature review of the literature discussing the distributional impact of monetary policy since the Great Financial Crisis. The primary focus of the thesis was to identify if the literature claims that monetary policy has a distributional effect on wealth and income. To do so, roughly 40 scholarly publications, books, and articles were analysed. The analysis revealed several transmission channels through which monetary policy may be transmitted to heterogeneous economic actors such as households or countries (in the case of the European Monetary Union). The analysis also revealed that most publications suggest that both conventional and unconventional monetary policies have a distributional impact to some degree. This overview includes the author's assessment of the literature's claims. The paper also reflects four general areas requiring further attention for academia and policymakers to comprehend monetary policy's distributional impact fully.

Abstract:

This thesis aimed to undertake a comprehensive literature review of the literature discussing the distributional impact of monetary policy since the Great Financial Crisis. The primary focus of the thesis was to identify if the literature claims that monetary policy has a distributional effect on wealth and income. To do so, roughly 40 scholarly publications, books, and articles were analysed. The analysis revealed several transmission channels through which monetary policy may be transmitted to heterogeneous economic actors such as households or countries (in the case of the European Monetary Union). The analysis also revealed that most publications suggest that both conventional and unconventional monetary policies have a distributional impact to some degree. This overview includes the author's assessment of the literature's claims. The paper also reflects four general areas requiring further attention for academia and policymakers to comprehend monetary policy's distributional impact fully.

Keywords

Distributional Impact, Monetary Policy, Central Banking, Income inequality, Wealth inequality, The Great Financial Crisis, Economic Heterogeneity

Language used: English

Date on which the thesis was submitted / produced: 11. 12. 2023

Thesis defence

• Date of defence: 11. 1. 2024
• Supervisor: Mgr. Vladan Hodulák, Ph.D.
• Reader: Ing. Mgr. Petr Svatoň

Masaryk University

Faculty of Social Studies

Master programme / field:
International Relations and European Politics / International Relations and European Politics