Abstract

The Distributional Wealth Accounts, which integrate granular household survey data from all euro area countries with quarterly macroeconomic balance sheets from financial and national accounts, provide a comprehensive statistical framework for analyzing household wealth dynamics. This granularity enables precise analysis of how economic shocks and policy measures affect different segments of the wealth distribution, enhancing the understanding of distributional effects through detailed tracking of asset and liability composition. As a use case, the impact of monetary policy on the distribution of household wealth and inequality across the euro area is examined. Panel local projections reveal that monetary policy exerts non-neutral effects across the wealth distribution: net wealth responds most strongly among low-wealth households, more moderately for the middle group, and remains largely unaffected for the top ten percent. The heterogeneous balance sheet structure of households is identified as a key factor underlying these results. In this context, the Distributional Wealth Accounts offer significant advantages by capturing the diversity of household assets and liabilities across the wealth spectrum.