Government spending shocks have substantially different effects on consumers across the income distribution: consumption increases for the poor whereas it decreases for the rich in response to a rise in government expenditure. I shed light on this issue by incorporating a progressive tax scheme...

It is well-known that real wages are procyclical conditional on a monetary policy shock. This paper challenges this conventional view by using a quantitative heterogeneous-agent New Keynesian economy with sticky wages. In the model with benchmark calibration, the wage rate per effective unit of...