Business fluctuations and cycles

• The Propagation of U.S. Shocks to Canada: Understanding the Role of Real-Financial Linkages

  Staff Working Paper 2010-40 Kimberly Beaton, René Lalonde, Stephen Snudden

  This paper examines the transmission of U.S. real and financial shocks to Canada and, in particular, the role of financial frictions in affecting the transmission of these shocks. These questions are addressed within the Bank of Canada's Global Economy Model (de Resende et al. forthcoming), a dynamic stochastic general-equilibrium model with an active banking sector and a detailed role for financial frictions.

  Content Type(s): Staff research, Staff working papers Topic(s): Business fluctuations and cycles, Economic models, International topics JEL Code(s): E, E2, E21, E27, E3, E32, F, F3, F36, F4, F40
• November 18, 2010

  Financial Stress, Monetary Policy, and Economic Activity

  Bank of Canada Review - Autumn 2010 Fuchun Li, Pierre St-Amant

  The recent global crisis was characterized by a remarkable intensity in the negative feedback process between financial sector developments and the real economy.

  Content Type(s): Publications, Bank of Canada Review articles Topic(s): Business fluctuations and cycles, Economic models, Monetary policy transmission

• Capital Requirement and Financial Frictions in Banking: Macroeconomic Implications

  Staff Working Paper 2010-26 Ali Dib

  The author develops a dynamic stochastic general-equilibrium model with an active banking sector, a financial accelerator, and financial frictions in the interbank and bank capital markets.

  Content Type(s): Staff research, Staff working papers Topic(s): Business fluctuations and cycles, Economic models, Financial markets, Financial stability JEL Code(s): E, E3, E32, E4, E44, G, G1

• Banks, Credit Market Frictions, and Business Cycles

  Staff Working Paper 2010-24 Ali Dib

  The author proposes a micro-founded framework that incorporates an active banking sector into a dynamic stochastic general-equilibrium model with a financial accelerator.

  Content Type(s): Staff research, Staff working papers Topic(s): Business fluctuations and cycles, Credit and credit aggregates, Economic models, Financial stability JEL Code(s): E, E3, E32, E4, E44, G, G1

• Inventories in ToTEM

  Staff Discussion Paper 2010-9 Oleksiy Kryvtsov, Yang Zhang

  ToTEM – the Bank of Canada’s principal projection and policy-analysis model for the Canadian economy – is extended to include inventories. In the model, firms accumulate inventories of finished goods for their role in facilitating the demand for goods.

  Content Type(s): Staff research, Staff discussion papers Topic(s): Business fluctuations and cycles, Economic models JEL Code(s): E, E3, E31, E32

• Inventories, Stockouts, and ToTEM

  Staff Discussion Paper 2010-8 Oleksiy Kryvtsov, Yang Zhang

  Inventory investment is an important component of the Canadian business cycle. Despite its small average size – less than 1 per cent of output – it exhibits volatile procyclical fluctuations, accounting for almost one-third of output variance.

  Content Type(s): Staff research, Staff discussion papers Topic(s): Business fluctuations and cycles, Monetary policy transmission JEL Code(s): E, E3, E31, E32

• The Transmission of Shocks to the Chinese Economy in a Global Context: A Model-Based Approach

  Staff Working Paper 2010-17 Jeannine Bailliu, Patrick Blagrave

  To better understand the dynamics of the Chinese economy and its interaction with the global economy, the authors incorporate China into an existing model for the G-3 economies (i.e., the United States, the euro area, and Japan), paying particular attention to modelling the exchange rate and monetary policy in China.

  Content Type(s): Staff research, Staff working papers Topic(s): Business fluctuations and cycles, Economic models, Exchange rate regimes, International topics JEL Code(s): E, E3, E32, E5, E52, F, F4, F41

• Statistical Confidence Intervals for the Bank of Canada's Business Outlook Survey

  Staff Discussion Paper 2010-7 Daniel de Munnik

  While a number of central banks publish their own business conditions indicators that rely on non-random sampling, knowledge about their statistical accuracy has been limited.

  Content Type(s): Staff research, Staff discussion papers Topic(s): Business fluctuations and cycles, Central bank research, Regional economic developments JEL Code(s): C, C4, C46, C8, C81

• Prospects for Global Current Account Rebalancing

  Staff Discussion Paper 2010-4 Kimberly Beaton, Carlos De Resende, René Lalonde, Stephen Snudden

  The authors use the Bank of Canada's version of the Global Economy Model, a multi-country, multi-sector dynamic stochastic general-equilibrium model with an active banking system (the BoC-GEM-FIN), to study the evolution of global current account balances following the recent global financial crisis.

  Content Type(s): Staff research, Staff discussion papers Topic(s): Balance of payments and components, Business fluctuations and cycles, International topics, Recent economic and financial developments JEL Code(s): E, E2, E21, F, F0, F01, F3, F32

• Le pouvoir de prévision des indices PMI

  Staff Discussion Paper 2010-3 Claudia Godbout, Jocelyn Jacob

  The forecast of world economic growth plays a key role in the conduct of Canadian monetary policy. In this context, the authors study the usefulness of the monthly Purchasing Managers’ Indexes (PMIs) in predicting short-term real GDP growth in the euro area, Japan, the United Kingdom, and China, as well as in the world economy.

  Content Type(s): Staff research, Staff discussion papers Topic(s): Business fluctuations and cycles, International topics JEL Code(s): E, E3, E37, F, F4, F47