understanding of the relationship of monetary policy to inequality has lagged behind the mounting political debate on the issue. bernanke ( 2015 ) proposed a simple “ litmus test ” to cut through our difficulties in forming a complete picture of the effects of qe : “ if the average working person were given the choice of the status quo ( current fed policies ) and a situation with both a weaker labour market and lower stock prices ( tighter fed policies ), which would he or she choose? ” this question would appear to offer a fitting background to our discussion here today. 3. inequality in a monetary union in the euro area, the debate has stressed another potential distributional spillover of monetary policy : redistribution of resources not only within countries but also between the member states of the monetary union. naturally, the effects of monetary policy on the member states may well be asymmetric, and very strong views on the way the asymmetry works in this particular case have been expressed. to cite one : “ while households in countries strongly affected by the crisis are relieved, others, namely german households, are suffering from the very same measures. ” 16 to the extent that within the cross section of households an expansion produces winners and losers and that these are unevenly distributed across countries, monetary policy may of course also reallocate resources across national borders. to be sure, in a fully integrated economic union this would not be an issue. in the euro area it might be, though, because the lack of a common fiscal policy framework means there are no tools to neutralise the potential distributional effects of mp. however, the concerns about the redistributional effects of monetary expansions across euro - area countries reflect an oversimplified representation of the monetary policy transmission mechanism. in fact, understanding these cross - country effects is, if anything, even harder than grasping within - country effects. one difficulty is simply measurement. the data are not comparable across countries because of differences in the definitions of income and wealth, the way taxes are treated, the primary sources used, and often the processing of the data. measuring income and wealth consistently in a large economic area is not easy. 17 and where the status quo itself is measured inaccurately, gauging the impact of a shock ( monetary or otherwise ) becomes problematic at best. 18 “ britain ’ s richest 5 % gained most from quantitative easing, ” the guardian, 23 august 2012. holzhausen and sikova ( 2014 ). the statistical traditions of european countries

ignazio visco : the g20 under italy ’ s leadership in 2021 keynote speech by mr ignazio visco, governor of the bank of italy, at the global foundation – rome roundtable 2020 “ which way the world after the pandemic? our inclusive human future ”, virtual meeting, 16 - 17 november 2020. * * * your excellences, ladies and gentlemen, it is a great pleasure to join the 2020 virtual edition of the rome roundtable meeting. i would like to thank the secretary general steve howard for giving me the opportunity to address such a distinguished group of guests and the chairman rob knott for his kind introduction. next year italy will chair the group of twenty ( g20 ) for the first time since it started its gatherings in 1999. our presidency, not unlike the one that is about to conclude, takes hold under exceptional circumstances. the covid - 19 pandemic, a human tragedy, has triggered an economic collapse that is unprecedented in recent history. according to the latest imf projections, global activity will contract by 4. 4 per cent this year, the worst result since world war ii. at the time of the global financial crisis, in their statement at the 2009 pittsburgh summit, g20 leaders designated the group to be the “ premier forum for our international economic cooperation ”. global financial stability was then in danger ; that crisis had sizeable costs, but coordinated actions succeeded in halting a more costly spiral and, also through the work of the financial stability board ( fsb ), making our financial systems more resilient. today ’ s pandemic crisis brings to the fore another extremely dangerous challenge that must be addressed with ever closer cooperation across countries. we now realise that the risks of a global health crisis have been substantially underestimated. they are by no means the only ones : environmental sustainability, poverty eradication, trade openness, financial stability and knowledge transfer all contain elements of a global public good, whose provision may fall dangerously below desirable levels if national interests and market outcomes are not mediated through the balance of a truly multilateral, consensus - based and far - sighted approach. * * * three keywords embody the overarching priority themes of the italian g20 presidency : people, planet, and prosperity. the agenda of the italian g20 finance track, the work stream led by finance ministers and central bank governors, will then be inspired by those three words. as a cross - cutting issue i want to emphasise