Monetary Policy and the Evolution of Wealth Disparity: An Assessment Using US Survey of Consumer Finance Data

Parker, D.N. & Semmler, W. (2024). Monetary Policy and the Evolution of Wealth Disparity: An Assessment Using US Survey of Consumer Finance Data. Computational Economics 10.1007/s10614-024-10560-1. (In Press)

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Abstract

In the context of the studies of income and wealth distribution, this paper explores evidence to what extent recent monetary policy had distribution effects. This research utilizes the Federal Reserve Board’s Survey of Consumer Finances to identify at least two sub populations and follow their dynamics as monetary policy moved from conventional interest rate setting to unconventional Quantitative Easting policy. This is achieved through use of Weighted Expectation Maximization Cluster Modeling, and the Malhalanobis Distance between cluster means. This approach is used to study volatility and bifurcation in distributions of capital gains and incomes to U.S. households through the Financial Crisis and Sars-CoV-2 pandemic.

Item Type:	Article
Uncontrolled Keywords:	Cluster modeling; Malhalanobis distance; Quantitative easing; Unsupervised learning; Wealth disparity; Weighted expectation maximization
Research Programs:	Economic Frontiers (EF)
Depositing User:	Michaela Rossini
Date Deposited:	19 Mar 2024 13:28
Last Modified:	19 Mar 2024 13:28
URI:	https://pure.iiasa.ac.at/19566

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