Shopping behavior and the effect of monetary policy on inflation heterogeneity along the income distribution

• 成果类型: Article
• 署名作者: Ampudia, Miguel; Ehrmann, Michael; Strasser, Georg
• 署名单位: European Central Bank
• 刊物名称: JOURNAL OF MONETARY ECONOMICS
• ISSN/ISSBN: 0304-3932
• DOI: 10.1016/j.jmoneco.2024.103618
• 发表日期: 2024
• 关键词: inflation; distributional effects; monetary policy; Shopping behavior; substitution

摘要

This paper studies the effect of monetary policy on inflation along the income distribution in the euro area and shows that monetary policy has differential effects. In response to monetary tightenings, high-income households engage in more intense product substitution and trade down in the product and store space relative to low-income households, such that their inflation responds relatively more. This channel stands in contrast to the effect arising from different consumption bundles, which imply that the inflation experienced by high-income households responds less to monetary policy. The paper also reveals substantial cross-country heterogeneity, with the product substitution channel being more pronounced in countries where price differences between possible substitutes are larger.