Ethan Ilzetzki's picture
Affiliation: 
London School of Economics

Voting history

Monetary Policy and Inequality

Question 2: What role should inequality play in the monetary policy decisions (interest rate policy and quantitative easing)?

Answer:
Minimal role
Confidence level:
Confident
Comment:
The central bank should focus on price stability and fiscal policy should deal with income and wealth inequality, including those arising due to the distributional impact of monetary policy. Inequality should play a role in the BoE's considerations insofar as income and wealth inequality affect the transmission of fiscal policy.

Question 1: How large is the impact of monetary policy on the joint distribution of income and wealth?

Answer:
Small
Confidence level:
Confident
Comment:
Monetary policy reflects interest rate changes around a long-run neutral rate of interest. This neutral interest rate has important distributional implications but is mostly outside of the control of the Bank of England. If monetary policy is conducted appropriately, the interest rate will be above the neutral rate roughly as often as it is below, so will have only temporary or second order implications for the distribution of wealth and income. The only first-order impact, in my view, is the effect of monetary policy on unemployment, which the Bank of England already considers to some extent.

Central Bank Digital Currency for the UK

Question 2: What effect will the introduction of a CBDC have on UK banks?

Answer:
Moderate harm
Confidence level:
Not confident at all
Comment:
I doubt CBDCs will be designed in such a way that they usurp banks' traditional role. If banks are "disrupted" it will be due to private sector developments and I expect banks will evolve to face these new challenges.

Question 1: How beneficial would it be to the UK economy for the Bank of England to introduce a central bank digital currency in some form in the upcoming decade?

 

Answer:
Beneficial
Confidence level:
Not confident at all
Comment:
Times will require the Bank to introduce a CBDC. Its cost and benefits will depend greatly on design.

Fiscal Rules in the European Monetary Union

Question 2: Which of the following is the one reform you would choose to improve fiscal rules?

Answer:
Expansion of EU level fiscal capacity for expanded mutual insurance
Confidence level:
Not confident

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