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1934
result(s)
Housing Affordability and Parental Income Support
Staff Working Paper 2024-28
Jason Allen,
Kyra Carmichael,
Robert Clark,
Shaoteng Li,
Nicolas Vincent
In many countries, the cost of housing has greatly outpaced income growth, leading to a housing affordability crisis. Leveraging Canadian loan-level data and quasi-experimental variation in payment-to-income constraints, we document an increasing reliance of first-time homebuyers on financial help from their parents, through mortgage co-signing. We show that parental support can effectively relax borrowing constraints—potentially to riskier borrowers.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Financial services,
Financial system regulation and policies,
Housing
JEL Code(s):
D,
D6,
D64,
E,
E2,
E21,
E24,
G,
G1,
G18,
G5,
G51
Central Bank Digital Currency and Transmission of Monetary Policy
Staff Working Paper 2024-27
Saroj Bhattarai,
Mohammad Davoodalhosseini,
Zhenning Zhao
How does the transmission of monetary policy change when a central bank digital currency (CBDC) is introduced in the economy? Does CBDC design matter? We study these questions in a general equilibrium model with nominal rigidities, liquidity frictions, and a banking sector where commercial banks face a leverage constraint.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Digital currencies and fintech,
Interest rates,
Monetary policy,
Monetary policy framework,
Monetary policy transmission
JEL Code(s):
E,
E3,
E31,
E4,
E5,
E50,
E58,
G,
G2,
G21,
G5,
G51
Credit Card Minimum Payment Restrictions
Staff Working Paper 2024-26
Jason Allen,
Michael Boutros,
Benedict Guttman-Kenney
We study a government policy that restricts repayment choices with the aim of reducing credit card debt and estimate its effects by applying a difference-in-differences methodology to comprehensive credit-reporting data about Canadian consumers. We find the policy has trade-offs: reducing revolving debt comes at a cost of reducing credit access, and potentially increasing delinquency.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Credit and credit aggregates,
Financial system regulation and policies
JEL Code(s):
D,
D1,
D18,
E,
E2,
E21,
G,
G2,
G28,
G5,
G51
The reliance of Canadians on credit card debt as a predictor of financial stress
Staff Analytical Note 2024-18
Jia Qi Xiao
I analyze the relationship between carrying a credit card balance and future financial stress. I find that carrying a balance significantly increases the likelihood that credit card holders miss future debt payments. This likelihood tends to rise as credit card balances grow and are held for long periods.
Content Type(s):
Staff research,
Staff analytical notes
Topic(s):
Credit and credit aggregates,
Financial institutions,
Interest rates,
Recent economic and financial developments
JEL Code(s):
D,
D1,
E,
E4,
E5,
G,
G2,
G21
Could all-to-all trading improve liquidity in the Government of Canada bond market?
Staff Analytical Note 2024-17
Jabir Sandhu,
Rishi Vala
We find that on any given day, nearly half of Government of Canada bond transactions by clients of dealers can be offset with other clients, including during the turmoil in March 2020. Our results show that under certain conditions clients could potentially trade directly with each other and are a step towards understanding the relevance of broader all-to-all trading in the Government of Canada bond market.
Content Type(s):
Staff research,
Staff analytical notes
Topic(s):
Coronavirus disease (COVID-19),
Financial institutions,
Financial markets,
Financial stability,
Market structure and pricing
JEL Code(s):
D,
D4,
D47,
D5,
D53,
G,
G0,
G01,
G1,
G12,
G13,
G14,
G2,
G21,
G23
The Ecology of Automated Market Makers
Staff Discussion Paper 2024-12
Annetta Ho,
Cosmin Cazan,
Andrew Schrumm
This paper describes the ecology of automated market makers, which are the most popular decentralized exchange model for the pricing and trading of crypto assets within decentralized finance.
Content Type(s):
Staff research,
Staff discussion papers
Topic(s):
Digital currencies and fintech,
Financial markets,
Financial stability,
Financial system regulation and policies
JEL Code(s):
G,
G1,
G2
The Role of Public Money in the Digital Age
Staff Discussion Paper 2024-11
Francisco Rivadeneyra,
Scott Hendry,
Alejandro García
A well-functioning monetary system is characterized by public and private forms of money that exchange at par as value flows freely between them. A relevant retail public money—whether in the form of cash, a central bank digital currency or both—is a necessary component of such a monetary system.
Content Type(s):
Staff research,
Staff discussion papers
Topic(s):
Central bank research,
Digital currencies and fintech,
Payment clearing and settlement systems
JEL Code(s):
E,
E4,
E42,
E5,
E50,
E58
Untapped Potential: Mobile Device Ownership and Mobile Payments in Canada
Staff Working Paper 2024-25
Marie-Hélène Felt,
Angelika Welte,
Katrina Talavera
We present a two-stage model of mobile phone and mobile payment usage that controls for selectivity. This reveals unobserved factors that work against having a mobile phone and toward mobile paying. Therefore, people who are unable to acquire or choose not to own a mobile device might have unmet payment needs.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Bank notes,
Digital currencies and fintech,
Econometric and statistical methods
JEL Code(s):
C,
C3,
C39,
D,
D1,
D12,
E,
E4,
E42
Analysis of DeFi Oracles
Staff Discussion Paper 2024-10
Xun Deng,
Sidi Mohamed Beillahi,
Cyrus Minwalla,
Han Du,
Andreas Veneris,
Fan Long
Oracles are constructs used in decentralized finance to price assets relative to each other. However, oracles contain defects that could lead to manipulation attacks. Such attacks exploit pricing models embedded within oracles to defraud creators and users. We automatically verify defects, which if mitigated, improves the security of digital currency.
Content Type(s):
Staff research,
Staff discussion papers
Topic(s):
Central bank research,
Digital currencies and fintech,
Payment clearing and settlement systems
JEL Code(s):
E,
E4,
E42,
E5,
E51,
G,
G1,
G15,
O,
O3,
O31