02119cas a2200277 a 4500 AALejournalIMF018999 230101c9999 xx r poo 0 0eng d 5.00 USD 9781484393208 1018-5941 BD-DhAAL BD-DhAAL Gelos, R. Has Higher Household Indebtedness Weakened Monetary Policy Transmission? / R. Gelos, Tommaso Mancini Griffoli, Machiko Narita, Federico Grinberg. Washington, D.C. : International Monetary Fund, 2019. 1 online resource (33 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students Has monetary policy in advanced economies been less effective since the global financial crisis because of deteriorating household balance sheets? This paper examines the question using household data from the United States. It compares the responsiveness of household consumption to monetary policy shocks in the pre- and post-crisis periods, relating changes in monetary transmission to changes in household indebtedness and liquidity. The results show that the responsiveness of household consumption has diminished since the crisis. However, household balance sheets are not the culprit. Households with higher debt levels and lower shares of liquid assets are the most responsive to monetary policy, and the share of these households in the population grew. Other factors, such as economic uncertainty, appear to have played a bigger role in the decline of households' responsiveness to monetary policy. Mode of access: Internet Grinberg, Federico. Mancini Griffoli, Tommaso. Narita, Machiko. IMF Working Papers; Working Paper ; No. 2019/011 Full text available on IMF http://elibrary.imf.org/view/journals/001/2019/011/001.2019.issue-011-en.xml IMF e-Library