Posts
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Losses from Simulated Defaults in Canada's Large Value Transfer System
The Large Value Transfer System (LVTS) loss-sharing mechanism was designed to ensure that, in the event of a one-participant default, the collateral pledged by direct members of the system would be sufficient to cover the largest possible net debit position of a defaulting participant. However, the situation may not hold if the indirect effects of the defaults are taken into consideration, or if two participants default during the same payment cycle. -
Can the Common-Factor Hypothesis Explain the Observed Housing Wealth Effect?
The common-factor hypothesis is one possible explanation for the housing wealth effect. Under this hypothesis, house price appreciation is related to changes in consumption as long as the available proxies for the common driver of housing and non-housing demand are noisy and housing supply is not perfectly elastic. -
Search Frictions and Asset Price Volatility
We examine the quantitative effect of search frictions in product markets on asset price volatility. We combine several features from Shi (1997) and Lagos and Wright (2002) in a model without money. Households prefer special goods and general goods. -
September 10, 2020
Economic progress report: a very uneven recovery
Governor Tiff Macklem discusses the Bank’s latest interest rate announcement and explains the uneven impact that the COVID-19 pandemic is having on different sectors and people. -
February 16, 2023
No two ways about it: Why the Bank is committed to getting back to 2%
Deputy Governor Paul Beaudry discusses the benefits of being near the Bank’s 2% inflation target and the dangers of straying from it for too long. -
Government Spending Multipliers Under the Zero Lower Bound: Evidence from Japan
Using a rich data set on government spending forecasts in Japan, we provide new evidence on the effects of unexpected changes in government spending when the nominal interest rate is near the zero lower bound (ZLB). -
Efficiency and Economies of Scale of Large Canadian Banks
The authors measure the economies of scale of Canada's six largest banks and their costefficiency over time. Using a unique panel data set from 1983 to 2003, they estimate pooled translog cost functions and derive measures of relative efficiency and economies of scale. -
January 31, 2019
A Look Under the Hood of Canada’s Job Market
Senior Deputy Governor Carolyn A. Wilkins discusses developments in the Canadian labour market and factors that may help explain why wage growth is slower than expected. -
Y a-t-il eu surinvestissement au Canada durant la seconde moitié des années 1990?
This study on overinvestment differs from the existing literature in that investment in machinery and equipment is modelled as a structural vector autoregression with identification achieved by imposing long-run restrictions, as in Blanchard and Quah (1989).