10:00-11:00

Keith Kuester (Bonn University, Germany)
Doves for the Rich, Hawks for the Poor? Distributional Consequences of Monetary Policy

We build a New Keynesian business cycle model with the novel feature of rich household heterogeneity.  Households differ in the amount of savings, their patience, labor productivity, and employment status. Labor-market transitions are subject to matching frictions. We allow for aggregate saving. As a result, household heterogeneity affects the transmission of monetary policy to aggregate consumption, but hardly to GDP. Nevertheless, monetary policy has sizable distributional consequences. A majority of households would prefer monetary policy to be more accommodative than would be optimal absent the heterogeneity, helping “Main Street” at the expense of “Wall Street”.  (co-authors: Nils Gornemann and Makoto Nakajima.)

11:00-11:15  Break – Coffee, tea

11:15-12:15

Jan Marc Berk (De Nederlandsche Bank and Groningen University)
Quantitative Easing in the Euro Area

When deciding on providing monetary policy accommodation, central bankers weigh the costs and benefits of providing further stimulus. We provide a framework for assessing unconventional monetary policy, such as the ECB’s program of quantitative easing. It consists of three dimensions: (i) necessity, (ii) effectiveness and (iii) negative side-effects.  We conclude that the overall effects of QE in the euro area remain highly uncertain.

If you want to joint the workshop, please send an email to Milky Viola Gonzalez