November 13, 2014
Posts
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September 14, 2017
Summary of Monetary Policy Framework Issues: Toward the 2021 Inflation-Target Renewal
The day-long workshop, held at the Bank, brought out wide-ranging views on the goals of monetary policy, the effectiveness of monetary policy tools, the role of transparency and communications, and lessons learned from other central banks. -
Should Banks Be Worried About Dividend Restrictions?
A regulator would want to restrict dividends to force banks to rebuild capital during a crisis. But such a policy is not time-consistent. A time-consistent policy would let banks gradually rebuild capital and pay dividends even when their equity remains below pre-crisis levels. -
Effects of Funding Portfolios on the Credit Supply of Canadian Banks
This paper studies how banks simultaneously manage the two sides of their balance sheet and its implications for bank risk taking and real economic activity. First, we analyze how changes in funding affect the supply of bank loans. -
Exact Tests of Equal Forecast Accuracy with an Application to the Term Structure of Interest Rates
The author proposes a class of exact tests of the null hypothesis of exchangeable forecast errors and, hence, of the hypothesis of no difference in the unconditional accuracy of two competing forecasts. -
What Matters in Determining Capital Surcharges for Systemically Important Financial Institutions?
One way of internalizing the externalities that each individual bank imposes on the rest of the financial system is to impose capital surcharges on them in line with their systemic importance. -
Labor Market Participation, Unemployment and Monetary Policy
We incorporate a participation decision in a standard New Keynesian model with matching frictions and show that treating the labor force as constant leads to incorrect evaluation of alternative policies. -
Shock Transmission Through International Banks: Canada
In this paper, we investigate how liquidity conditions in Canada may affect domestic and/or foreign lending of globally active banks and whether this transmission is influenced by individual bank characteristics. -
Capital Structure, Pay Structure and Job Termination
We develop a model to analyze the link between financial leverage, worker pay structure and the risk of job termination. Contrary to the conventional view, we show that even in the absence of any agency problem among workers, variable pay can be optimal despite workers being risk averse and firms risk neutral. -
Estimates of the Sticky-Information Phillips Curve for the United States, Canada, and the United Kingdom
Mankiw and Reis (2001a) have proposed a "sticky-information"-based Phillips curve (SIPC) to address some of the concerns with the "sticky-price"-based new Keynesian Phillips curve.