(2018), “Services Deepening and the Transmission of Monetary Policy”, Journal of the European Economic Association, pp. 1-33. 30. Bouakez, H., Cardia, E. and Ruge-Murcia, F. (2014), “Sectoral Price Rigidity and Aggregate Dynamics”, European Economic Review, Vol. 65(C), pp. 1-22. 31.
Research based on heterogenous agents finds that the general equilibrium effect of monetary policy on labour demand, and hence disposable income, is significantly stronger than the intertemporal substitution channel. See Kaplan, G. et al. (2018), “Monetary Policy According to HANK”, American Economic Review, Vol. 108(3), pp. 697–743. 32. Borio, C. et al. (2023), “The two-regime view of inflation”, BIS Papers, No 133. 33.