Question 2: What role should inequality play in the monetary policy decisions (interest rate policy and quantitative easing)?
Answer:
No role
Confidence level:
Extremely confident
Comment:
Distributional issues are at the heart of politics and distributional questions should be decided by politicians not the unelected technocrats who staff central bank policy committees. If the distributional consequences of meeting the central bank's policy objectives (monetary and financial stability) are unacceptable, then in the first instance the government should use its fiscal tools to offset them. In the UK context, if the Chancellor were unhappy with the distributional consequences of setting monetary policy at the level necessary to meet the inflation target then he could also choose to exercise his override option. But in that case it would be clear that the decision was being made to 'aim off' the inflation target for distributional reasons and the responsibility for that decision lay with the political rather than the monetary authorities.
Question 1: How large is the impact of monetary policy on the joint distribution of income and wealth?
Answer:
Small
Confidence level:
Not confident
Comment:
The impact is potentially ambiguous and likely to be state-dependent. In particular, looser monetary policy tends to benefit those without jobs as well as benefitting those with assets (and vice versa).
In addition, it should be remembered that, broadly speaking, central banks are setting policy so as to keep output near potential and inflation at target. So it is wrong to think of monetary policy as an independent influence on inequality. It is instead the necessary reflection of all the other factors that affect demand and supply in the economy (i.e. the determinants of 'r*', the equilibrium real rate of interest).
Question 2: What effect will the introduction of a CBDC have on UK banks?
Answer:
Moderate benefits
Confidence level:
Confident
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?
The CFM surveys informs the public about the views held by prominent economists based in Europe on important macroeconomic and public policy questions. Some surveys focus specifically on the UK economy (as the CFM is a UK research centre), but surveys can in principle focus on any macroeconomic question for any region. The surveys shed light on the extent to which there is agreement or disagreement among these experts. An important motivation for the survey is to give a more comprehensive overview of the beliefs held by economists and in particular to include the views of those economists whose opinions are not frequently heard in public debates.
Questions mainly focus on macroeconomic and public policy topics. Although there are some questions that focus specifically on the UK economy, the setup of the survey is much broader and considers questions related to other countries/regions and also considers questions not tied to a specific economy.
The surveys are done in collaboration with the Centre for Economic Policy Research (CEPR).
Monetary Policy and Inequality
Question 2: What role should inequality play in the monetary policy decisions (interest rate policy and quantitative easing)?
Question 1: How large is the impact of monetary policy on the joint distribution of income and wealth?
Central Bank Digital Currency for the UK
Question 2: What effect will the introduction of a CBDC have on UK banks?
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?
Fiscal Rules in the European Monetary Union
Question 2: Which of the following is the one reform you would choose to improve fiscal rules?
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