Consumer Credit Regulation and Lender Market Power Staff working paper 2024-36 Zachary Bethune, Joaquín Saldain, Eric R. Young We investigate the welfare consequences of consumer credit regulation in a dynamic, heterogeneous-agent model with endogenous lender market power. Lenders post credit offers and borrowers—some informed and others uninformed—apply for credit. We calibrate the model to match characteristics of the unsecured consumer credit market and use the calibrated model to evaluate interest rate ceilings. Content Type(s): Staff research, Staff working papers JEL Code(s): D, D1, D15, D4, D43, D6, D60, D8, D83, E, E2, E21, G, G5, G51 Research Theme(s): Financial markets and funds management, Market functioning, Financial system, Financial institutions and intermediation, Financial stability and systemic risk, Household and business credit
Reconciling the Differences in Aggregate U.S. Wage Series Staff working paper 2016-1 Julien Champagne, André Kurmann, Jay Stewart Average hourly real wage series from the Labor Productivity and Costs (LPC) program and the Current Employment Statistics (CES) program have evolved very differently over the past decades. Content Type(s): Staff research, Staff working papers JEL Code(s): E, E0, E01, E2, E24, E3, E30, J, J3, J30 Research Theme(s): Monetary policy, Inflation dynamics and pressures, Real economy and forecasting
June 23, 2005 A Brief Survey of Risk-Appetite Indexes Financial System Review - June 2005 Mark Illing, Meyer Aaron Content Type(s): Publications, Financial System Review articles
May 25, 2017 Upgrading the Payments Grid: The Payoffs Are Greater Than You Think Remarks Sylvain Leduc Payments Canada Toronto, Ontario Deputy Governor Sylvain Leduc discusses how upgrading Canada’s core payment systems will contribute to financial stability and help the Bank keep inflation on target. Content Type(s): Press, Speeches and appearances, Remarks Subject(s): Currency, Digital currency, Financial system, Financial markets, Financial stability, Fintech
July 4, 2022 Canadian Survey of Consumer Expectations—Second Quarter of 2022 This survey took place between April 28 and May 13, 2022. Follow-up interviews took place in June. Consumers’ expectations for inflation have risen, alongside concerns about prices for food, gas and rent. Short-term expectations are at record-high levels. Long-term inflation expectations increased significantly in the second quarter of 2022, returning to the levels they were at before the COVID-19 pandemic. Most people believe the Bank of Canada can achieve its inflation target. However, some think the process of bringing inflation down will be difficult for the Bank of Canada. Expectations for higher inflation and rising interest rates weigh on consumer confidence. People expect that credit conditions will worsen and wage growth will not keep up with inflation. Flexible work arrangements could attract more people into the labour force. Content Type(s): Publications, Canadian Survey of Consumer Expectations
Understanding DeFi Through the Lens of a Production-Network Model Staff working paper 2023-42 Jonathan Chiu, Thorsten Koeppl, Hanna Yu, Shengxing Zhang We develop a production-network model to capture how decentralized finance (DeFi) has evolved across different sectors of financial services. The model allows us to measure the value added by different DeFi sectors and to study how the connections across the sectors influence token prices. Content Type(s): Staff research, Staff working papers JEL Code(s): G, G2 Research Theme(s): Models and tools, Economic models, Money and payments, Digital assets and fintech
The Simple Economics of Global Fuel Consumption Staff working paper 2019-35 Doga Bilgin, Reinhard Ellwanger This paper presents a structural framework of the global oil market that relies on information on global fuel consumption to identify flow demand for oil. We show that under mild identifying assumptions, data on global fuel consumption help to provide comparatively sharp insights on elasticities and other key structural parameters of the global oil market. Content Type(s): Staff research, Staff working papers JEL Code(s): C, C5, C51, L, L7, L71, Q, Q4, Q41, Q43 Research Theme(s): Models and tools, Economic models, Monetary policy, Inflation dynamics and pressures, Real economy and forecasting
Equity Option-Implied Probability of Default and Equity Recovery Rate Staff working paper 2016-58 Bo Young Chang, Greg Orosi There is a close link between prices of equity options and the default probability of a firm. We show that in the presence of positive expected equity recovery, standard methods that assume zero equity recovery at default misestimate the option-implied default probability. Content Type(s): Staff research, Staff working papers JEL Code(s): G, G1, G13, G3, G33 Research Theme(s): Financial markets and funds management, Market functioning, Financial system, Financial stability and systemic risk
The Market for Acquiring Card Payments from Small and Medium-Sized Canadian Merchants Staff discussion paper 2020-5 Angelika Welte, Jozsef Molnar This note uses industry data and a unique dataset of small and medium-sized merchants to provide insights into the acquirer-merchant market in Canada. Content Type(s): Staff research, Staff discussion papers JEL Code(s): C, C2, D, D2, E, E4, E42 Research Theme(s): Financial markets and funds management, Market structure, Money and payments, Payment and financial market infrastructures, Retail payments
Markov‐Switching Three‐Pass Regression Filter Staff working paper 2017-13 Pierre Guérin, Danilo Leiva-Leon, Massimiliano Marcellino We introduce a new approach for the estimation of high-dimensional factor models with regime-switching factor loadings by extending the linear three-pass regression filter to settings where parameters can vary according to Markov processes. Content Type(s): Staff research, Staff working papers JEL Code(s): C, C2, C22, C23, C5, C53 Research Theme(s): Models and tools, Econometric, statistical and computational methods, Economic models, Monetary policy, Real economy and forecasting