THE IMPACT OF QUANTITATIVE EASING ON THE WELFARE OF GERMANY AND THE USA: A COMPARATIVE ANALYSIS

Abstract

This paper examines the impact of Quantitative Easing (QE) on the welfare of Germany and the USA. QE is a monetary policy measure implemented during extreme economic conditions that aim to improve economic conditions and avoid replaying the latest depression. The study explores how the different approaches of Germany and the USA regarding QE, in terms of timing, intensity, and policy implementation, influenced the quality of people's lives. The analysis considers the secondary effects of QE on the well-being of economic agents. The study acknowledges that long-term measures to address poverty may be reversed quickly due to high inflation and that inflation stabilization takes priority. The lack of adequate redistribution programs may also lead to insufficient real economic growth. The study seeks to analyze the impact of QE on welfare today, over a decade since it was officially implemented as a measure. The success of economic measures depends on their design and implementation and not on universal connections or generalized expectations. Furthermore, appropriate complementary measures must be implemented to support the effects of a policy measure. Failure to meet the necessary prerequisites may lead to undesired results. Therefore, the paper explores the impact of QE on welfare from the perspectives of growth, trade, political relations, health care, and income. The study also considers the differences in institutions, structures, and people and how policies are implemented in the two countries. These differences provide a comprehensive overview of how the same policies yield different results regarding people's welfare. The heterogeneity of markets and the position of the population in relation to the adoption of macroeconomic policies and their impact are also analyzed. Overall, this study provides insights into the impact of QE on welfare in Germany and the USA. The findings can inform policy decisions to improve economic conditions and the population's well-being.