“…10 Specifically, it contributes to recent studies 7 As in Hagedorn et al (2019), we consider a HANK model with nominal wage stickiness and a calibration that attenuates the power of anticipated future monetary accommodation, which AIT relies on. In contrast to these authors, we however allow for positive (nominal) household debt as in Ferrante and Paustian (2019), such that there are redistributive effects that can potentially increase the effectiveness of future interest rate changes by reallocating resources between indebted high-and saving low-MPC households.…”