Exploring the Dynamic Shock of Unconventional Monetary Policy Channels on Income Inequality: A Panel VAR Approach

In response to the “Great Recession and Global Financial Crisis”, central banks had deploy unconventional monetary policies (UMP) in order fight severe impact of crisis. Therefore, purpose this study is examine dynamic shock through earning heterogeneity, income composition, portfolio channels on inequality emerging economies covering period 2000–2019, using panel vector autoregressive (PVAR) model. A PVAR model was designed for because its ability address dynamics numerous entities considered parallel. The findings suggest that UMPs used by these countries’ may have increased all investigated study, as a policy results positive inequality. Even when pre-tax income, held top 10%, adopted measure inequality, yields similar results. It evident bank’s objective should be fulfil mandate achieving maximum employment price stability, thus bringing wide economic benefits. Thus, some forms are more appropriate addressing concerns about (income or fiscal policy) than others. However, current alerts bank fact wounding consider cost drafting implementing kinds policies.