E - Macroeconomics and Monetary Economics

• Price-Level Targeting

  Staff Discussion Paper 2007-8 Agathe Côté

  In November 2006, the Bank of Canada announced its intention to lead a concerted research program over the next few years on the type of monetary policy framework that would best contribute to the economic well-being of Canadians in the decades ahead. The research will focus on two broad questions: whether economic welfare might be […]

  Content Type(s): Staff research, Staff discussion papers Topic(s): Monetary policy framework JEL Code(s): E, E5, E52, E58

• Endogenously Segmented Asset Market in an Inventory Theoretic Model of Money Demand

  Staff Working Paper 2007-46 Jonathan Chiu

  This paper studies the effects of monetary policy in an inventory theoretic model of money demand. In this model, agents keep inventories of money, despite the fact that money is dominated in rate of return by interest bearing assets, because they must pay a fixed cost to transfer funds between the asset market and the goods market.

  Content Type(s): Staff research, Staff working papers Topic(s): Monetary policy framework, Monetary policy transmission JEL Code(s): E, E3, E31, E4, E41, E5, E50

• Canada's Pioneering Experience with a Flexible Exchange Rate in the 1950s: (Hard) Lessons Learned for Monetary Policy in a Small Open Economy

  Staff Working Paper 2007-45 Michael Bordo, Ali Dib, Lawrence L. Schembri

  This paper revisits Canada's pioneering experience with floating exchange rate over the period 1950–1962. It examines whether the floating rate was the best option for Canada in the 1950s by developing and estimating a New Keynesian small open economy model of the Canadian economy.

  Content Type(s): Staff research, Staff working papers Topic(s): Economic models, Exchange rates JEL Code(s): E, E3, E32, E37, F, F3, F31, F32, N, N1

• Cyclical Behavior of Debt and Equity Using a Panel of Canadian Firms

  Staff Working Paper 2007-44 Francisco Covas, Wouter den Haan

  We document the cyclical behavior of debt, equity, and retained earnings for different firm categories using firm-level Canadian data.

  Content Type(s): Staff research, Staff working papers Topic(s): Business fluctuations and cycles JEL Code(s): E, E3, E32, G, G3, G32

• Trend Inflation, Wage and Price Rigidities, and Welfare

  Staff Working Paper 2007-42 Robert Amano, Kevin Moran, Stephen Murchison, Andrew Rennison

  This paper studies the steady-state costs of inflation in a general-equilibrium model with real per capita output growth and staggered nominal price and wage contracts.

  Content Type(s): Staff research, Staff working papers Topic(s): Inflation: costs and benefits JEL Code(s): E, E0, E5