Staff working papers provide a forum for staff to publish work-in-progress research intended for journal publication.
1320
result(s)
Gaining Credibility for Inflation Targets
Staff Working Paper 2001-11
James Yetman
In this paper, I consider a simple model in which agents learn about the inflation target of a central bank over time by observing the policy instrument or inflation outcomes. Measuring credibility as the distance between the perceived target and the actual target, an increase in credibility is beneficial to the central bank because it brings the policy consistent with attaining the inflation target closer to that required to attain the output target.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Credibility,
Inflation targets
JEL Code(s):
E,
E5,
E52
The Future Prospects for National Financial Markets and Trading Centres
Staff Working Paper 2001-10
Charles Gaa,
Stephen Lumpkin,
Robert Ogrodnick,
Peter Thurlow
This paper investigates the effects of the continuation of globalization and technological developments on the future of national-level financial markets and trading centres, particularly in smaller countries such as Canada. We foresee the development of a single global market in the most-liquid assets based on equity-market linkages.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Financial markets
JEL Code(s):
G,
G1,
G10
Testing for a Structural Break in the Volatility of Real GDP Growth in Canada
Staff Working Paper 2001-9
Alexandre Debs
This study tests for a structural break in the volatility of real GDP growth in Canada following the methodology of McConnell and Quiros (1998). A break is found in the first quarter of 1991.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Business fluctuations and cycles,
Econometric and statistical methods
JEL Code(s):
C,
C1,
C12,
E,
E3,
E32
How Rigid Are Nominal-Wage Rates?
Staff Working Paper 2001-8
Allan Crawford
This study examines the effect of nominal-wage rigidities on wage growth in Canada using a hazard model and micro data for union contracts. The hazard model is specified in a way that allows considerable flexibility in the shape of the estimated notional wage-change distribution.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Inflation targets,
Labour markets
JEL Code(s):
E,
E2,
E24,
E5,
E52,
E6,
E61
Downward Nominal-Wage Rigidity: Micro Evidence from Tobit Models
Staff Working Paper 2001-7
Allan Crawford,
Geoff Wright
This paper uses Tobit models and data for union contracts to examine the extent of downward nominal-wage rigidity in Canada. To be consistent with important stylized facts, the models allow the variance of the notional wage-change distribution to be time-varying and test for menu-cost effects.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Inflation targets,
Labour markets
JEL Code(s):
E,
E2,
E24,
E5,
E52,
E6,
E61
The Zero Bound on Nominal Interest Rates: How Important Is It?
Staff Working Paper 2001-6
David Amirault,
Brian O'Reilly
This paper surveys the literature on the zero bound on the nominal interest rate. It addresses questions ranging from the conditions under which the zero bound on the nominal interest rate might occur to policy options to avoid or use to exit from such a situation. We discuss literature that examines historical and country evidence, and literature that uses models to generate evidence on this question.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Credibility,
Inflation targets,
Monetary policy transmission
JEL Code(s):
E,
E3,
E31,
E5,
E52,
E58,
E6,
E61
Reactions of Canadian Interest Rates to Macroeconomic Announcements: Implications for Monetary Policy Transparency
Staff Working Paper 2001-5
Toni Gravelle,
Richhild Moessner
In this study we statistically quantify the reactions of Canadian and U.S. interest rates to macroeconomic announcements released in Canada and in the United States. We find that Canadian interest rates react very little to Canadian macroeconomic news and are significantly affected by U.S. macroeconomic news, which indicates that international influences on the Canadian fixed-income markets are important.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Financial markets,
Interest rates,
Monetary policy implementation
JEL Code(s):
E,
E0,
E4,
E5
On the Nature and the Stability of the Canadian Phillips Curve
Staff Working Paper 2001-4
Maral Kichian
This paper empirically determines why, during the 1990s, inflation in Canada was consistently more stable than predicted by the fixed-coefficients Phillips curve. A time-varying-coefficient model, where all the parameters adjust simultaneously, shows that the behaviour of expectations was probably a major contributing factor.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Business fluctuations and cycles,
Econometric and statistical methods,
Inflation and prices
JEL Code(s):
E,
E3,
E37
On Commodity-Sensitive Currencies and Inflation Targeting
Staff Working Paper 2001-3
Kevin Clinton
Two aspects of the recent monetary history of Canada, Australia, and New Zealand stand out: the sensitivity of their dollars to prices of resource-based commodities, and inflation targeting. This paper explores various aspects of these phenomena.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Exchange rates,
Inflation targets,
International topics,
Monetary policy implementation
JEL Code(s):
E,
E3,
E31,
E5,
E52,
F,
F3,
F31,
F4,
F42