Using detailed micro-data, this paper documents that households with lower income risk (and higher income levels …) exhibit a higher Marginal Propensity to Consume (MPC) in response to transitory income shocks, all else being equal. This … designed to account for the empirically observed negative correlation between income levels and income risk. This interaction …

composition of their income and on the components of their wealth. We first review the existing evidence on how monetary policy … affects income and wealth inequality. We then illustrate quantitatively how various channels of transmission - net interest … rate exposure, intertemporal substitution and indirect income channels - affect individual euro area households. We find …

-expressed as a share of 2021-22 income- were larger than a typical recession, and heterogeneous, e.g., 3% in France and 8% in Italy …