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Heterogeneity and Monetary Policy: A Thematic Review

Author

Listed:
  • Felipe Alves
  • Christian Bustamante
  • Xing Guo
  • Katya Kartashova
  • Soyoung Lee
  • Thomas Michael Pugh
  • Kurt See
  • Yaz Terajima
  • Alexander Ueberfeldt

Abstract

The heterogeneity of businesses and households impacts aggregate economic fluctuations and, in turn, is shaped by aggregate fluctuations. This view has emerged over the last decade with strong implications for the transmission and conduct of monetary policy. Our thematic review focuses on key aspects of this new theory as well as its underlying assumptions. We place the insights in a Canadian context using relevant microeconomic and macroeconomic data.

Suggested Citation

  • Felipe Alves & Christian Bustamante & Xing Guo & Katya Kartashova & Soyoung Lee & Thomas Michael Pugh & Kurt See & Yaz Terajima & Alexander Ueberfeldt, 2022. "Heterogeneity and Monetary Policy: A Thematic Review," Discussion Papers 2022-2, Bank of Canada.
    • Handle: RePEc:bca:bocadp:22-2
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    References listed on IDEAS

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    More about this item

    Keywords

    Economic models; Monetary policy and uncertainty; Monetary policy transmission;
    All these keywords.

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • E50 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - General
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
    • D25 - Microeconomics - - Production and Organizations - - - Intertemporal Firm Choice: Investment, Capacity, and Financing
    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity

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