Search

Financial innovations and the removal of the reserve requirements in the early 1990s have made the distinction between demand and notice deposits arbitrary.

Conventional wisdom holds that institutional changes and trade liberalization are two main sources of growth in per capita income around the world.

Since the autumn of 1997, the Bank of Canada's regional offices (located in Halifax, Montréal, Toronto, Calgary, and Vancouver) have conducted consultations with businesses across Canada on a quarterly basis. These consultations are now referred to as the Business Outlook Survey (BOS).

This article describes the major trends in the growth of labour productivity in Canada since the early 1960s and summarizes our current knowledge about the causes of the historical patterns. Particular attention is given to the period since the mid-1990s during which productivity growth has been significantly higher in the United States than in Canada. The author reviews the empirical evidence on the contribution of information and communication technology to the recent difference between Canadian and U.S. rates of productivity growth. Other determinants of a country's productivity performance, such as human capital formation and openness to international trade, are also examined. The article concludes with an assessment of the prospects for an increase in the trend rate of productivity growth in Canada over the coming years.

The impact of oil price shocks on the U.S. economy is a topic of considerable debate. In this paper, we examine the response of U.S. consumers to the 2014–2015 negative oil price shock using representative survey data from the Consumer Expenditure Survey.

This paper proposes new measures of the integrated variance, measures which use high-frequency bid-ask spreads and quoted depths. The traditional approach assumes that the mid-quote is a good measure of frictionless price.

Freedman and Engert focus on the changing pattern of lending and borrowing in Canada in the past thirty to forty years, including the types of financial instruments used and the relative roles of financial institutions and financial markets. They examine how borrowing mechanisms have changed over time and consider the challenges facing the Canadian financial sector, including whether our financial markets are in danger of disappearing because of the size and pre-eminence of U.S. financial markets. Some of the trends examined here include syndicated lending, securitization, and credit derivatives, a form of financial engineering that has become increasingly important in the last few years. They also study bond and equity markets to determine whether Canadian capital markets have been hollowed out or abandoned by Canadian firms and conclude that the data do not provide much support for that view.

This paper studies optimal discretionary monetary and fiscal policy when the lower bound on nominal interest rates is occasionally binding in a model with nominal rigidities and long-term government debt. At the lower bound it is optimal for the government to temporarily reduce debt.

For stationary transformations of variables, there exists a maximum horizon beyond which forecasts can provide no more information about the variable than is present in the unconditional mean. Meteorological forecasts, typically excepting only experimental or exploratory situations, are not reported beyond this horizon; by contrast, little generally accepted information about such maximum horizons is available for economic variables.

The authors assess the stabilization properties of simple monetary policy rules within the context of a small open-economy model constructed around the limited-participation assumption and calibrated to salient features of the Canadian economy. By relying on limited participation as the main nominal friction that affects the artificial economy, the authors provide an important check of the robustness of the results obtained using alternative environments in the literature on monetary policy rules, most notably the now-standard "New Keynesian" paradigm that emphasizes rigidities in the price-setting mechanism.