Directly to content
  1. Publishing |
  2. Search |
  3. Browse |
  4. Recent items rss |
  5. Open Access |
  6. Jur. Issues |
  7. DeutschClear Cookie - decide language by browser settings

Heterogeneous consumers, segmented asset markets, and the effects of monetary policy

Enders, Zeno

PDF, English
Download (643kB) | Terms of use

Citation of documents: Please do not cite the URL that is displayed in your browser location input, instead use the persistent URL or the URN below, as we can guarantee their long-time accessibility.


This paper examines how segmented asset markets can generate real and nominal effects of monetary policy. I develop a model, in which varieties of consumption bundles are purchased sequentially. Newly injected money thus disseminates slowly through the economy via second-round effects and induces a longer-lasting, non-degenerate wealth distribution. As a result, the demand elasticity differs across consumers, affecting optimal markups chosen by producers. The model predicts a short-term inflation-output trade-off, a liquidity effect, countercyclical markups, and procyclical wages and expenditure dispersion across consumers after monetary shocks. Including a modest degree of real or nominal wage rigidity yields responses that are also quantitatively in line with empirical evidence.

Item Type: Working paper
Series Name: Discussion Paper Series / University of Heidelberg, Department of Economics
Volume: 0537
Date Deposited: 13 Dec 2012 11:24
Date: December 2012
Number of Pages: 32
Faculties / Institutes: The Faculty of Economics and Social Studies > Alfred-Weber-Institut for Economics
Subjects: 330 Economics
Uncontrolled Keywords: Segmented Asset Markets , Monetary Policy , Countercyclical Markups , Liquidity Effect , Expenditure Dispersion
Schriftenreihe ID: Discussion Paper Series / University of Heidelberg, Department of Economics
About | FAQ | Contact | Imprint |
OA-LogoDINI certificate 2013Logo der Open-Archives-Initiative