Staff working papers

Staff working papers provide a forum for staff to publish work-in-progress research intended for journal publication.

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1330 result(s)

Structural Multi-Equation Macroeconomic Models: Identification-Robust Estimation and Fit

Staff Working Paper 2009-19 Jean-Marie Dufour, Lynda Khalaf, Maral Kichian
Weak identification is likely to be prevalent in multi-equation macroeconomic models such as in dynamic stochastic general equilibrium setups. Identification difficulties cause the breakdown of standard asymptotic procedures, making inference unreliable.

Simulations du ratio du service de la dette des consommateurs en utilisant des données micro

Staff Working Paper 2009-18 Ramdane Djoudad
The author constructs a formal analytic framework to simulate the impact of various economic shocks on the household debt-service ratio, using data from the Canadian Financial Monitor (CFM) survey.

Adopting Price-Level Targeting under Imperfect Credibility in ToTEM

Using the Bank of Canada's main projection and policy-analysis model, ToTEM, this paper measures the welfare gains of switching from inflation targeting to price-level targeting under imperfect credibility. Following the policy change, private agents assign a probability to the event that the policy-maker will revert to inflation-targeting next period.

Real Effects of Price Stability with Endogenous Nominal Indexation

Staff Working Paper 2009-16 Césaire Meh, Vincenzo Quadrini, Yaz Terajima
We study a model with repeated moral hazard where financial contracts are not fully indexed to inflation because nominal prices are observed with delay as in Jovanovic & Ueda (1997).

Heterogeneous Beliefs and Housing-Market Boom-Bust Cycles in a Small Open Economy

Staff Working Paper 2009-15 Hajime Tomura
This paper introduces heterogeneous beliefs among households in a small open economy model for the Canadian economy. The model suggests that simultaneous boom-bust cycles in house prices, output, investment, consumption and hours worked emerge when credit-constrained mortgage borrowers expect that future house prices will rise and this expectation is neither shared by savers nor realized ex-post.

Testing for Financial Contagion with Applications to the Canadian Banking System

Staff Working Paper 2009-14 Fuchun Li
The author proposes a new test for financial contagion based on a non-parametric measure of the cross-market correlation. The test does not depend on the assumption that the data are drawn from a given probability distribution; therefore, it allows for maximal flexibility in fitting into the data.

Price Movements in the Canadian Residential Mortgage Market

Staff Working Paper 2009-13 Jason Allen, Darcey McVanel
The authors empirically analyze the price-setting behaviour of the major Canadian banks in the residential mortgage market over the period 1991–2007. They use weekly posted prices of the major mortgage providers to study the degree of competition in mortgage price setting.
Content Type(s): Staff research, Staff working papers Topic(s): Financial institutions, Financial services JEL Code(s): D, D4, G, G2

Information Flows and Aggregate Persistence

Staff Working Paper 2009-11 Oleksiy Kryvtsov
Models with imperfect information that generate persistent monetary nonneutrality predominantly rely on assumptions leading to substantial heterogeneity of information across price-setters. This paper develops a quantitative general equilibrium model in which the degree of heterogeneity of information is determined endogenously.

Computing the Accuracy of Complex Non-Random Sampling Methods: The Case of the Bank of Canada's Business Outlook Survey

Staff Working Paper 2009-10 Daniel de Munnik, David Dupuis, Mark Illing
A number of central banks publish their own business conditions survey based on non-random sampling methods. The results of these surveys influence monetary policy decisions and thus affect expectations in financial markets. To date, however, no one has computed the statistical accuracy of these surveys because their respective non-random sampling method renders this assessment non-trivial.
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