Rethinking monetary policy in the framework of inclusive and sustainable growth

The 2030 Agenda for Sustainable Development places equality and sustainability at the centre of policy agendas. Nowadays, socially inclusive and environmentally sustainable economic growth is a central priority of public policy for most governments worldwide. Based on the theoretical and conceptual frameworks of inclusive growth and sustainable growth, we focus on monetary policy as a powerful macroeconomic policy tool connected with distributional and environmental issues. We deal with how high levels in income and wealth inequality, on the one hand, and shocks related to environmental degradation and climate change, on the other hand, it might have substantial implications for the conduct of monetary policy. We also contribute to the ongoing debate on rethinking monetary policy in terms of intra- and inter-generational equity by assessing the extent to which central banks could actively contribute to reducing economic inequalities and environmental unsustainability and internalize these challenges in their policy objectives and actions.