Find Bank of Canada research by keyword, author, content type, JEL code, topic or date of publication.
Receive notification by email whenever new research is added to the website.
292
result(s)
Consumer Search, Productivity Heterogeneity, Prices, Markups, and Pass-through: Theory and Estimation
Staff Working Paper 2024-50
Alex Chernoff,
Allen Head,
Beverly Lapham
We develop and estimate a search model in which identical consumers trade with price-setting firms that differ in productivity. We use the estimated model to characterize the qualitative and quantitative differences in prices and markups across firms. We explore how individual firms respond to changes in cost and demand and how they pass these through to their prices and markup.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Inflation and prices,
Service sector
JEL Code(s):
E,
E3,
E31,
L,
L1,
L16
Preferences, Monetary Policy and Household Inflation
Staff Working Paper 2024-45
Geoffrey R. Dunbar
I quantify the importance of changes in household preferences on household inflation rates using 11 years of scanner data for 11,000 US households. My results suggest that changes in household preferences are an important driver of inflation dynamics at the household level.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Inflation and prices,
Monetary policy transmission
JEL Code(s):
D,
D1,
D12,
E,
E5,
E52,
E58
How Do Households Respond to Expected Inflation? An Investigation of Transmission Mechanisms
Staff Working Paper 2024-44
Janet Hua Jiang,
Rupal Kamdar,
Kelin Lu,
Daniela Puzzello
We conduct surveys to study how consumer spending responds to higher inflation expectations. Most respondents spend the same, sticking to fixed budget plans or not considering inflation for spending decisions. About 20% decrease spending because they feel poorer and cut spending to invest in inflation-proof assets. Very few increase spending.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Central bank research,
Inflation and prices,
Inflation targets,
Monetary policy,
Monetary policy transmission
JEL Code(s):
D,
D1,
D15,
D8,
D84,
E,
E2,
E5,
E52,
E7
Monetary Policy Transmission amid Demand Reallocations
Staff Working Paper 2024-42
Julien Bengui,
Lu Han,
Gaelan MacKenzie
We analyze the transmission of monetary policy during different phases of a sectoral demand reallocation episode when there are frictions to increasing production in a sector. Monetary policy is more effective in reducing inflation when a larger proportion of sectors are expanding or expect to expand in the near future.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Domestic demand and components,
Inflation and prices,
Monetary policy transmission
JEL Code(s):
E,
E1,
E12,
E2,
E24,
E3,
E31,
E5,
E52
Immigration and US Shelter Prices: The Role of Geographical and Immigrant Heterogeneity
Staff Working Paper 2024-40
James Cabral,
Walter Steingress
The arrival of immigrants increases demand for housing and puts upward pressure on shelter prices. Using instrumental variables based on the ancestry composition of residents in US counties, we estimate the causal impact of immigration on local shelter prices.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Housing,
Inflation and prices,
International topics,
Regional economic developments
JEL Code(s):
J,
J6,
J61,
R,
R2,
R23,
R3,
R31
Does Unconventional Monetary and Fiscal Policy Contribute to the COVID Inflation Surge in the US?
Staff Working Paper 2024-38
Jing Cynthia Wu,
Yinxi Xie,
Ji Zhang
We assess whether unconventional monetary and fiscal policy implemented in response to the COVID-19 pandemic in the U.S. contribute to the 2021-2023 inflation surge through the lens of several different empirical methodologies and establish a null result.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Business fluctuations and cycles,
Central bank research,
Fiscal policy,
Inflation and prices,
Monetary policy
JEL Code(s):
E,
E3,
E31,
E5,
E52,
E6,
E63
Household Food Inflation in Canada
Staff Working Paper 2024-33
Olena Kostyshyna,
Maude Ouellet
We study food inflation rates for Canadian households during periods of low and high inflation from 2012Q4 to 2023Q4. Households experienced more varied inflation rates during the recent high inflation. Cumulative food inflation has been 2.2 percentage points higher for lower-income households than for highest-income households since the inflation surge.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Inflation and prices
JEL Code(s):
E,
E2,
E21,
E3,
E30,
E31,
L,
L8,
L81
Price Discounts and Cheapflation During the Post-Pandemic Inflation Surge
Staff Working Paper 2024-31
Alberto Cavallo,
Oleksiy Kryvtsov
We study how price variation within a store changes with inflation, and whether households exploit these changes to reduce the burden of inflation. We find that price changes from discounts mitigated the inflation burden while cheapflation exacerbated it.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Inflation and prices,
Inflation: costs and benefits,
Market structure and pricing
JEL Code(s):
E,
E2,
E21,
E3,
E30,
E31,
L,
L8,
L81
The Output-Inflation Trade-off in Canada
Staff Discussion Paper 2024-7
Stefano Gnocchi,
Fanny McKellips,
Rodrigo Sekkel,
Laure Simon,
Yinxi Xie,
Yang Zhang
We explain how the Bank of Canada’s policy models capture the trade-off between output and inflation in Canada. We provide new estimates of the trade-off and contrast them with those in the Bank’s macroeconomic models.
Content Type(s):
Staff research,
Staff discussion papers
Topic(s):
Business fluctuations and cycles,
Econometric and statistical methods,
Inflation and prices,
Monetary policy transmission
JEL Code(s):
E,
E3,
E31,
E5,
E52