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Monetary Policy and the Distribution of Income: Evidence from U.S. Metropolitan Areas

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Abstract

The steady rise in income inequality and the broad range of actions undertaken by central banks in recent years – first to stabilize the global economy during the 2008-09 financial crisis and second to stave off the pandemic-induced economic collapse – have brought the distributional footprint of monetary policy to the forefront of the economic policymaking discussion (Bernanke, 2015; Draghi, 2016; BIS, 2021).

Suggested Citation

  • Giovanni Favara & Francesca Loria & Greg Marchal & Egon Zakrajšek, 2025. "Monetary Policy and the Distribution of Income: Evidence from U.S. Metropolitan Areas," FEDS Notes 2025-03-31-2, Board of Governors of the Federal Reserve System (U.S.).
    • Handle: RePEc:fip:fedgfn:2025-03-31-2
    DOI: 10.17016/2380-7172.3757
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    References listed on IDEAS

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    1. Jonathan Heathcote & Fabrizio Perri & Gianluca Violante, 2020. "The Rise of US Earnings Inequality: Does the Cycle Drive the Trend?," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 37, pages 181-204, August.
    2. Kuttner, Kenneth N., 2001. "Monetary policy surprises and interest rates: Evidence from the Fed funds futures market," Journal of Monetary Economics, Elsevier, vol. 47(3), pages 523-544, June.
    3. James D. Hamilton, 2018. "Why You Should Never Use the Hodrick-Prescott Filter," The Review of Economics and Statistics, MIT Press, vol. 100(5), pages 831-843, December.
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    More about this item

    JEL classification:

    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies

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