Posts
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Habit Formation and the Persistence of Monetary Shocks
This paper studies the persistent effects of monetary shocks on output. Previous empirical literature documents this persistence, but standard general-equilibrium models with sticky prices fail to generate output responses beyond the duration of nominal contracts. -
The Performance and Robustness of Simple Monetary Policy Rules in Models of the Canadian Economy
In this report, we evaluate several simple monetary policy rules in twelve private and public sector models of the Canadian economy. Our results indicate that none of the simple policy rules we examined is robust to model uncertainty, in that no single rule performs well in all models. -
October 30, 2012
Opening Statement before the House of Commons Standing Committee on Finance
Good afternoon. Tiff and I are pleased to be here with you today to discuss the October Monetary Policy Report, which the Bank published last week. The global economy has unfolded broadly as the Bank projected in its July MPR. Growth has slowed in all major regions. The economic expansion in the United States is […] -
How Important Is Liquidity Risk for Sovereign Bond Risk Premia? Evidence from the London Stock Exchange
This paper uses the framework of arbitrage-pricing theory to study the relationship between liquidity risk and sovereign bond risk premia. The London Stock Exchange in the late 19th century is an ideal laboratory in which to test the proposition that liquidity risk affects the price of sovereign debt. -
Inflation Targeting and Liquidity Traps Under Endogenous Credibility
Policy implications are derived for an inflation-targeting central bank, whose credibility is endogenous and depends on its past ability to achieve its targets. This is done in a New Keynesian framework with heterogeneous and boundedly rational expectations. -
June 18, 1997
The Canadian economy: Challenges and prospects
Once a year, the Bank of Canada's Board of Directors meets outside Ottawa, alternating among the provinces. I am delighted that this year's out-of-town meeting has brought us to the beautiful and historic city of Quebec. I would like to take this opportunity to talk to you about recent developments in our economy. -
Optimal Monetary Policy during Endogenous Housing-Market Boom-Bust Cycles
This paper uses a small-open economy model for the Canadian economy to examine the optimal Taylor-type monetary policy rule that stabilizes output and inflation in an environment where endogenous boom-bust cycles in house prices can occur. -
State Dependence in Fundamentals and Preferences Explains Risk-Aversion Puzzle
The authors examine the ability of economic models with regime shifts to rationalize and explain the risk-aversion and pricing-kernel puzzles put forward in Jackwerth (2000). -
November 20, 2018
Choosing the Best Monetary Policy Framework for Canada
Senior Deputy Governor Carolyn A. Wilkins discusses public policy issues around monetary policy frameworks and how those issues have become more complex in the post-global financial crisis world.