Bio

Serdar Kabaca is the Director of Model Development and Research in the Financial Stability Department. He is a macroeconomist whose primary research interest include monetary policy transmission mechanisms, business cycle fluctuations in small open economies, and policy spillovers from large systemic economies. He is currently working on the drivers of inflation as well as the domestic and international spillover effects of unconventional monetary policies. He holds a Ph.D from University of British Columbia.

Staff discussion papers

Transition Scenarios for Analyzing Climate-Related Financial Risk

Staff Discussion Paper 2022-1 Y.-H. Henry Chen, Erik Ens, Olivier Gervais, Hossein Hosseini, Craig Johnston, Serdar Kabaca, Miguel Molico, Sergey Paltsev, Alex Proulx, Argyn Toktamyssov
Climate transition scenarios clarify climate-related risks to our economy and financial system. This paper summarizes key results of Canada-relevant scenarios developed in a pilot project on climate risk by the Bank of Canada and the Office of the Superintendent of Financial Institutions.
Content Type(s): Staff research, Staff discussion papers Topic(s): Climate change, Economic models, Financial stability, International topics JEL Code(s): C, C6, C68, D, D5, D58, E, E5, E50, O, O4, O44, P, P1, P18, Q, Q5, Q54

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Staff working papers

International Portfolio Rebalancing and Fiscal Policy Spillovers

Staff Working Paper 2023-56 Sami Alpanda, Uluc Aysun, Serdar Kabaca
We evaluate, both empirically and theoretically, the spillover effects that debt-financed fiscal policy interventions of the United States have on other economies. We consider a two-country model with international portfolio rebalancing effects. We show that US fiscal expansions would increase global long-term rates and hinder economic activity in the rest of the world.
Content Type(s): Staff research, Staff working papers Topic(s): Economic models, Fiscal policy, International topics JEL Code(s): E, E3, E32, E6, E62, F, F4, F41, F44

Supply Drivers of US Inflation Since the COVID-19 Pandemic

Staff Working Paper 2023-19 Serdar Kabaca, Kerem Tuzcuoglu
This paper examines the contribution of several supply factors to US headline inflation since the start of the COVID-19 pandemic. We identify six supply shocks using a structural VAR model: labor supply, labor productivity, global supply chain, oil price, price mark-up and wage mark-up shocks.
Content Type(s): Staff research, Staff working papers Topic(s): Business fluctuations and cycles, Econometric and statistical methods, Inflation and prices JEL Code(s): C, C3, C32, E, E3, E31, E32

International Transmission of Quantitative Easing Policies: Evidence from Canada

Staff Working Paper 2022-30 Serdar Kabaca, Kerem Tuzcuoglu
This paper examines the cross-border spillovers from major economies’ quantitative easing (QE) policies to their trading partners. We concentrate on spillovers from the US to Canada during the zero lower bound period when QE policies were actively used.
Content Type(s): Staff research, Staff working papers Topic(s): Business fluctuations and cycles, International topics, Monetary policy transmission JEL Code(s): E, E5, E52, F, F4, F41, F44

Foreign Exchange Interventions: The Long and the Short of It

Staff Working Paper 2022-25 Patrick Alexander, Sami Alpanda, Serdar Kabaca
This paper studies the effects of foreign exchange (FX) interventions in a two-region model where governments issue both short- and long-term bonds. We find that the term premium channel dominates the trade balance channel in our calibrated model. As a result, the conventional beggar-thy-neighbor effects of interventions are overturned.
Content Type(s): Staff research, Staff working papers Topic(s): Business fluctuations and cycles, Exchange rate regimes, Exchange rates, Foreign reserves management, International financial markets, International topics JEL Code(s): F, F3, F31, F33, F4, F41

Optimal Quantitative Easing in a Monetary Union

Staff Working Paper 2020-49 Serdar Kabaca, Renske Maas, Kostas Mavromatis, Romanos Priftis
How should a central bank conduct quantitative easing (QE) in a monetary union when regions differ in their size and portfolio characteristics? Optimal QE policy suggests allocating greater purchases from the region that faces stronger portfolio frictions, and not necessarily according to each region’s size.
Content Type(s): Staff research, Staff working papers Topic(s): Business fluctuations and cycles, Economic models, Monetary policy JEL Code(s): E, E4, E43, E5, E52, E58

Quantitative Easing in a Small Open Economy: An International Portfolio Balancing Approach

Staff Working Paper 2016-55 Serdar Kabaca
This paper studies the effects of quantitative easing (QE) in a small open economy dynamic stochastic general-equilibrium model with international portfolio balancing. Portfolios are classified as imperfectly substitutable short-term and long-term subportfolios, each including domestic and foreign bonds.
Content Type(s): Staff research, Staff working papers Topic(s): International topics, Monetary policy transmission JEL Code(s): E, E5, E52, F, F4, F41

International Spillovers of Large-Scale Asset Purchases

Staff Working Paper 2015-2 Sami Alpanda, Serdar Kabaca
This paper evaluates the international spillover effects of large-scale asset purchases (LSAPs) using a two-country dynamic stochastic general-equilibrium model with nominal and real rigidities, and portfolio balance effects.
Content Type(s): Staff research, Staff working papers Topic(s): Economic models, International topics, Monetary policy transmission JEL Code(s): E, E5, E52, F, F4, F41

Labour Share Fluctuations in Emerging Markets: The Role of the Cost of Borrowing

Staff Working Paper 2014-47 Serdar Kabaca
This paper contributes to the literature by documenting labour income share fluctuations in emerging-market economies and proposing an explanation for them. Time-series data indicate that emerging markets differ from developed markets in terms of changes in the labour share over the business cycle.
Content Type(s): Staff research, Staff working papers Topic(s): Business fluctuations and cycles, Development economics, Interest rates, International topics, Labour markets JEL Code(s): E, E2, E25, E4, E44, F, F4, F41

Search Frictions, Financial Frictions and Labour Market Fluctuations in Emerging Markets

Staff Working Paper 2014-35 Sumru Altug, Serdar Kabaca
This paper examines the role of the extensive and intensive margins of labour input in the context of a business cycle model with a financial friction. We document significant variation in the hours worked per worker for many emerging-market economies. Both employment and hours worked per worker are positively correlated with each other and with output.
Content Type(s): Staff research, Staff working papers Topic(s): Business fluctuations and cycles, Development economics, Interest rates, International topics, Labour markets JEL Code(s): E, E4, E44, F, F4, F41, J, J4, J40

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Journal publications

Refereed journals

Other

Research

  • "Labor Share Fluctuations in Emerging Markets : The Role of the Cost of Borrowing"