Michael McMahon's picture
Affiliation: 
University of Oxford
Credentials: 
Professor of Economics

Voting history

ECB Monetary Policy and Catch-up Inflation

Question 2: Which of the following policies is the most desirable to meet the ECBs objective to achieve its mandate of “price stability” as you understand this term.

Answer:
Average inflation targeting
Confidence level:
Confident

Question 1: To what extent do you agree with the following statement? “The European Central Bank should systematically allow for inflation to exceed its target to compensate for periods of below target inflation.”

Answer:
Agree
Confidence level:
Confident

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:
To the extent that inequality changes the transmission of policy or shocks to the economy, it is important for monetary policymakers to be aware of developments including those that come from its own past actions. Should the central bank try to affect inequality directly? I don't think so. The central bank does not have good tools to deal with inequality; fiscal policy can be more targeted and it is important that the objectives of redistributive policies reflect the preferences of the electorate.

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

Answer:
Large
Confidence level:
Confident
Comment:
There are clearly channels of monetary policy (and also financial policies) that benefit asset prices and therefore directly affect the position of those that hold positive net financial assets. The effect of QE on financial assets is one obvious one, but also effects on house prices which likely affect a wider number of households.

Asset Prices and Monetary Policy

Proposition 2: Asset prices and financial imbalances are best addressed using macroprudential tools and left out of the monetary policy decision making process.

 

Answer:
Agree
Confidence level:
Very confident
Comment:
Though the information from financial balances can be important inputs into the monetary policy process - for example, because it can provide information on the transmission of monetary policy through the banking system.

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