Capital and income inequality: An aggregate-demand complementarity

• 成果类型: Article
• 署名作者: Bilbiie, Florin O.; Kanzig, Diego R.; Surico, Paolo
• 署名单位: University of Cambridge; University of Lausanne; Center for Economic & Policy Research (CEPR); University of London; London Business School
• 刊物名称: JOURNAL OF MONETARY ECONOMICS
• ISSN/ISSBN: 0304-3932
• DOI: 10.1016/j.jmoneco.2022.01.002
• 发表日期: 2022
• 页码: 154-169
• 关键词: capital; income inequality; aggregate demand; COMPLEMENTARITY; monetary policy; Heterogeneity

摘要

A novel complementarity between capital and income inequality leads to a significant amplification of the effects of aggregate-demand shocks on consumption. We characterize this finding using a simple model with heterogeneity in household saving and income, nominal rigidities, and capital. A fiscal policy that redistributes capital income causes further amplification, whereas redistributing profits generates dampening. After an interest rate shock, consumption inequality is more countercyclical than income inequality, consistent with the available empirical evidence. Procyclical investment also requires a more aggressive Taylor rule in order to attain determinacy, and aggravates the forward guidance puzzle. (C) 2022 Elsevier B.V. All rights reserved.