FINANCIAL VULNERABILITY AND INCOME INEQUALITY: NEW EVIDENCE FROM OECD COUNTRIES
Abstract
This study explores, for the first time, how financial vulnerability affects income
inequality across OECD countries, from 1990 to 2015. The empirics use a new financial
vulnerability index constructed by Adrian and Duarte (2016). Through the methodology
of their modeling approach, panel GARCH and GMM methods, the findings indicate
that financial vulnerability exerts a negative impact on income equality conditions.
The results survive certain definitions of income inequality and corruption, while
they highlight the importance of financial stability conditions, with potential further
repercussions to the real economy.
Downloads
References
Redistribution and Inequality. In: Atkinson, A.B., & Bourguignon, F. (Eds.)
Handbook of Income Distribution, Vol 2. Elsevier, North-Holland.
Adrian, T., & Duarte, F. (2016). Financial Vulnerability and Monetary Policy.
Federal Reserve Bank of New York Staff Reports, No. 804.
Adrian, T., & Liang, N. (2017). Monetary Policy, Financial Conditions, and
Financial Stability. International Journal of Central Banking, 10, 95-135.
Adrian, T., & Shin, H. (2010). Financial Intermediaries and Monetary Economics.
Handbook of Monetary Economics, 3, 601-650.
Adrian, T., Boyarchenko, N., & Giannone, D. (2016). Vulnerable Growth. Federal
Reserve Bank of New York Staff Reports, No. 794.
Adrian, T., Covitz, D., & Liang, N. (2015). Financial Stability Monitoring. Annual
Review of Financial Economics, 7, 357-395.
Aikman, D., Kiley, M., Lee, S.J., Palumbo, M.G., & Warusawitharana, M. (2017).
Mapping Heat in the U.S. Financial System. Journal of Banking and Finance, 81,
36-64.
Copyright (c) 2019 Buletin Ekonomi Moneter dan Perbankan
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.
Buletin Ekonomi Moneter dan Perbankan / Bulletin of Monetary Economics and Banking is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.
