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Housing and the Redistributive Effects of Monetary Policy

Author

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  • Michael Reiter

    (Institute for Advanced Studies)

  • Philipp Hergovich

    (University of Vienna)

Abstract

We study the redistributive effects of monetary policy in the framework of a large OLG model, with endogenous housing choice, downpayment constraints, and different types of shocks. We pay special attention to the structure of debt, whether it is short-term or long-term, nominal or real. We find that monetary policy shocks have long-lasting effects on the inter-generational wealth distribution. While the debt structure only has a mild effect on aggregate statistics, it matters a lot for how different types of shocks under different monetary policy regimes affect the distribution.

Suggested Citation

  • Michael Reiter & Philipp Hergovich, 2016. "Housing and the Redistributive Effects of Monetary Policy," 2016 Meeting Papers 1324, Society for Economic Dynamics.
    • Handle: RePEc:red:sed016:1324
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    References listed on IDEAS

    as
    1. Albanesi, Stefania, 2007. "Inflation and inequality," Journal of Monetary Economics, Elsevier, vol. 54(4), pages 1088-1114, May.
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    7. Nils M. Gornemann & Keith Kuester & Makoto Nakajima, 2016. "Doves for the Rich, Hawks for the Poor? Distributional Consequences of Monetary Policy," International Finance Discussion Papers 1167, Board of Governors of the Federal Reserve System (U.S.).
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