Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/278227 
Year of Publication: 
2022
Series/Report no.: 
ECB Working Paper No. 2752
Publisher: 
European Central Bank (ECB), Frankfurt a. M.
Abstract: 
This paper assesses the role of the housing market in the transmission of conventional and unconventional monetary policy across euro area regions. By exploiting a novel regional dataset on housing-related variables, a structural panel VAR analysis shows that monetary policy propagates effectively to economic activity and house prices, albeit in a heterogeneous fashion across regions. Although the housing channel plays a minor role in the transmission of monetary policy to the economy on average, its importance increases in the case of unconventional monetary policy. We also explore the determinants of the diverse transmis- sion of monetary policy to economic activity across regions, finding a larger impact in areas with lower labour income and more widespread homeownership. An expansionary monetary policy can thus be effective in mitigating regional inequality via its stimulus to the economy.
Subjects: 
housing market
conventional and unconventional monetary policy
regional inequality
business cycles
JEL: 
D31
E32
E44
E52
R31
Persistent Identifier of the first edition: 
ISBN: 
978-92-899-5400-6
Document Type: 
Working Paper

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