Staff research, Publications
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Can Capital Deepening Explain the Global Decline in Labor’s Share?
We estimate an aggregate elasticity of substitution between capital and labor near or below one, which implies that capital deepening cannot explain the global decline in labor's share. Our methodology derives from transition paths in the neo-classical growth model. -
The Productivity Slowdown in Canada: An ICT Phenomenon?
We ask whether a weaker contribution of information and communication technologies (ICT) to productivity growth could account for the productivity slowdown observed in Canada since the early 2000s. To answer this question, we consider several methods capturing channels through which ICT could affect aggregate productivity growth. -
A Framework for Analyzing Monetary Policy in an Economy with E-money
This paper considers an economy where central-bank-issued fiat money competes with privately issued e-money. We study a policy-setting game between the central bank and the e-money issuer and find (1) the optimal monetary policy of the central bank depends on the policy of the private issuer and may deviate from the Friedman rule; (2) multiple equilibria may exist; (3) when the economy approaches a cashless state, the central bank’s optimal policy improves the market power of the e-money issuer and can lead to a discrete decrease in welfare and a discrete increase in inflation; and (4) first best cannot be achieved. -
The Secular Decline of Forecasted Interest Rates
Canadian interest rates show a secular decline since the 1980s. Long-term survey-based forecasts of interest rates also declined, but less so and were more gradual. Our model-based estimates show an endpoint shifting over time in three phases: a decline between 1990 and 1995, a period of stability between 1996 and 2007, and a further decline since 2008. The current endpoint estimate remains clouded with uncertainty; this is an active area of research. -
January 9, 2019
Monetary Policy Report – January 2019
The Bank projects that Canadian economic growth will slow to 1.7 per cent this year before rebounding to 2.1 per cent in 2020. -
December 31, 2018
Research Update - December 2018
This monthly newsletter features the latest research publications by Bank of Canada economists including external publications and working papers published on the Bank of Canada’s website. -
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December 21, 2018
Business Outlook Survey—Winter 2018
Results from the winter Business Outlook Survey continue to indicate positive business sentiment and elevated capacity pressures in most regions. For firms in the Prairies, the outlook has weakened. -
December 21, 2018
Senior Loan Officer Survey—Fourth Quarter of 2018
Overall household lending conditions were unchanged this quarter, although mortgage approval rates were lower. More widespread easing of business lending conditions continues to be driven by competition for corporate borrowers.