Money Demand and Economic Uncertainty Staff Working Paper 2004-25 Joseph Atta-Mensah The author examines the impact of economic uncertainty on the demand for money. Content Type(s): Staff research, Staff working papers Research Topic(s): Monetary aggregates JEL Code(s): E, E4, E41, E5, E50
Time-Consistent Control in Non-Linear Models Staff Working Paper 2007-3 Steve Ambler, Florian Pelgrin We show how to use optimal control theory to derive optimal time-consistent Markov-perfect government policies in nonlinear dynamic general equilibrium models, extending the result of Cohen and Michel (1988) for models with quadratic objective functions and linear dynamics. We replace private agents' costates by flexible functions of current states in the government's maximization problem. Content Type(s): Staff research, Staff working papers Research Topic(s): Fiscal policy, Monetary policy framework JEL Code(s): C, C6, C63, E, E6, E61, E62
The Role of Convenience and Risk in Consumers' Means of Payment Staff Discussion Paper 2009-8 Carlos Arango, Varya Taylor Using data from a 2004 survey of the Canadian public, the authors study the role of convenience and risk in consumers' use of cash relative to debit and credit cards. The authors find that consumers who perceive debit cards and credit cards to be more convenient and less risky than cash use them more frequently. Content Type(s): Staff research, Staff discussion papers Research Topic(s): Bank notes JEL Code(s): E, E4, E41, L, L2
Endogenous Borrowing Constraints and Consumption Volatility in a Small Open Economy Staff Working Paper 2006-37 Carlos De Resende Consumption volatility relative to output volatility is consistently higher in emerging economies than in developed economies. Content Type(s): Staff research, Staff working papers Research Topic(s): International topics JEL Code(s): F, F3, F32, F34, F4, F41
May 17, 2012 On the Adjustment of the Global Economy Bank of Canada Review - Spring 2012 Carlos De Resende, Claudia Godbout, René Lalonde, Eric Morin, Nikita Perevalov This article discusses three scenarios for the adjustment of the global economy. In a “baseline” scenario—which encompasses fiscal consolidation in major advanced economies, growth-friendly structural reforms in Europe and Japan, and greater exchange rate flexibility and reforms in the emerging-market economies of Asia to induce rotation of demand away from net exports—global current account imbalances […] Content Type(s): Publications, Bank of Canada Review articles Research Topic(s): Balance of payments and components, Exchange rates, Fiscal policy, International topics, Recent economic and financial developments JEL Code(s): F, F3, F32, F37, F4, F42
December 21, 2008 Good Policies or Good Fortune: What Drove the Compression in Emerging- Market Spreads? Financial System Review - December 2008 Philipp Maier, Garima Vasishtha Content Type(s): Publications, Financial System Review articles
May 19, 2011 Understanding and Measuring Liquidity Risk: A Selection of Recent Research Bank of Canada Review - Spring 2011 Céline Gauthier, Hajime Tomura During the recent financial crisis, one of the forces set in motion by the initial losses on subprime-mortgage loans was a significant decline in the market liquidity of assets and in the ability of financial institutions to obtain funding in wholesale markets. In this article, the authors summarize recent research that clarifies the role of liquidity in destabilizing the financial system and examine the implications of this research for the recently announced financial system reforms, including Basel III. Content Type(s): Publications, Bank of Canada Review articles Research Topic(s): Financial markets, Financial stability, Financial system regulation and policies
Estimated DGE Models and Forecasting Accuracy: A Preliminary Investigation with Canadian Data Staff Working Paper 2002-18 Kevin Moran, Veronika Dolar This paper applies the hybrid dynamic general-equilibrium, vector autoregressive (DGE-VAR) model developed by Ireland (1999) to Canadian time series. Content Type(s): Staff research, Staff working papers Research Topic(s): Business fluctuations and cycles, Economic models JEL Code(s): E, E3, E32, E37
Liquidity and Central Clearing: Evidence from the CDS Market Staff Working Paper 2012-38 Joshua Slive, Jonathan Witmer, Elizabeth Woodman An international initiative to increase the use of central clearing for OTC derivatives emerged as one of the reactions to the 2008 financial crisis. The move to central clearing is a fundamental change in the structure of the market. Content Type(s): Staff research, Staff working papers Research Topic(s): Financial markets JEL Code(s): G, G3, G30, G38
Expectations and Monetary Policy: Experimental Evidence Staff Working Paper 2013-44 Oleksiy Kryvtsov, Luba Petersen The effectiveness of monetary policy depends, to a large extent, on market expectations of its future actions. In a standard New Keynesian business-cycle model with rational expectations, systematic monetary policy reduces the variance of inflation and the output gap by at least two-thirds. Content Type(s): Staff research, Staff working papers Research Topic(s): Business fluctuations and cycles, Monetary policy implementation, Monetary policy transmission JEL Code(s): C, C9, D, D8, D84, E, E3, E5, E52