TY  - UNPD
A1  - Bartscher, Alina Kristin
A1  - Kuhn, Moritz
A1  - Schularick, Moritz
A1  - Wachtel, Paul
T1  - Monetary policy and racial inequality
T2  - LawFin working paper ; No. 15
N2  - This paper aims at an improved understanding of the relationship between monetary policy and racial inequality. We investigate the distributional effects of monetary policy in a unified framework, linking monetary policy shocks both to earnings and wealth differentials between black and white households. Specifically, we show that, although a more accommodative monetary policy increases employment of black households more than white households, the overall effects are small. At the same time, an accommodative monetary policy shock exacerbates the wealth difference between black and white households, because black households own less financial assets that appreciate in value. Over multi-year time horizons, the employment effects are substantially smaller than the countervailing portfolio effects. We conclude that there is little reason to think that accommodative monetary policy plays a significant role in reducing racial inequities in the way often discussed. On the contrary, it may well accentuate inequalities for extended periods.
T3  - LawFin Working Paper - 15 
KW  - monetary policy
KW  - racial inequality
KW  - income distribution
KW  - wealth distribution
KW  - wealth effects
Y1  - 2021
UR  - http://publikationen.ub.uni-frankfurt.de/frontdoor/index/index/docId/61655
UR  - https://nbn-resolving.org/urn:nbn:de:hebis:30:3-616550
IS  - January 2021
PB  - Center for Advanced Studies on the Foundations of Law and Finance, House of Finance, Goethe University
CY  - Frankfurt am Main
ER  -