A 'Reverse Robin Hood'? The Distributional Implications of Non-Standard Monetary Policy for Italian Households

47 Pages Posted: 10 Nov 2016

See all articles by Marco Casiraghi

Marco Casiraghi

Bank of Italy; International Monetary Fund (IMF) - International Capital Markets Department

Eugenio Gaiotti

Bank of Italy

Maria Lisa Rodano

Bank of Italy

Alessandro Secchi

Bank of Italy

Date Written: July 21, 2016

Abstract

We study empirically the distributional implications of a non-standard monetary policy expansion, considering the measures implemented by the Eurosystem in 2011-2012 and exploiting a rich micro dataset on Italian households’ income and wealth, in order to take contemporaneously into account a number of income- and wealth-related channels. Our results do not support the claim that an unconventional monetary loosening acts as a “reverse Robin Hood”. Larger benefits accrue to households at the bottom of the income scale, as the effects via the stimulus to economic activity and employment outweigh those via financial variables. The response of net wealth is U-shaped: less wealthy households take advantage of their leveraged positions, wealthier households of their larger share of financial assets. Overall, the effects on inequality are negligible. The results also suggest that the risk of an “expropriation of savers” is not likely to materialize, as the decrease in the remuneration of savings is compensated by support to labour income and by capital gains.

Keywords: monetary policy, interest rates, policy effects, inequality

JEL Classification: E52, E58, I14

Suggested Citation

Casiraghi, Marco and Casiraghi, Marco and Gaiotti, Eugenio and Rodano, Maria Lisa and Secchi, Alessandro, A 'Reverse Robin Hood'? The Distributional Implications of Non-Standard Monetary Policy for Italian Households (July 21, 2016). Bank of Italy Temi di Discussione (Working Paper) No. 1077, Available at SSRN: https://ssrn.com/abstract=2867447 or http://dx.doi.org/10.2139/ssrn.2867447

Marco Casiraghi

Bank of Italy ( email )

Via Nazionale 91
Rome, 00184
Italy

International Monetary Fund (IMF) - International Capital Markets Department ( email )

700 19th Street NW
Washington, DC 20431
United States

Eugenio Gaiotti (Contact Author)

Bank of Italy ( email )

Via Nazionale 91
Rome, 00184
Italy
+39 06 4092 2718 (Phone)
+39 06 4792 3723 (Fax)

Maria Lisa Rodano

Bank of Italy ( email )

Via Nazionale 91
Rome, 00184
Italy

Alessandro Secchi

Bank of Italy ( email )

Via Nazionale 91
Rome, 00184
Italy

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
45
Abstract Views
521
PlumX Metrics