The Side Effects of Safe Asset Creation Staff Working Paper 2021-34 Sushant Acharya, Keshav Dogra The secular decline in real interest rates has created a challenge for monetary policy, now confronting the zero lower bound more often. An increase in the supply of safe assets reduces downward pressure on the natural interest rate. This allows monetary policy to reach price stability and full employment, but not without cost—permanently lower investment. Content Type(s): Staff research, Staff working papers Research Topic(s): Fiscal policy, Monetary policy implementation JEL Code(s): E, E3, E4, E5, G, G1, H, H6
The Distributional Effects of Conventional Monetary Policy and Quantitative Easing: Evidence from an Estimated DSGE Model Staff Working Paper 2019-6 Stefan Hohberger, Romanos Priftis, Lukas Vogel This paper compares the distributional effects of conventional monetary policy and quantitative easing (QE) within an estimated open-economy DSGE model of the euro area. Content Type(s): Staff research, Staff working papers Research Topic(s): Economic models, Interest rates, Monetary policy, Monetary policy transmission JEL Code(s): E, E4, E44, E5, E52, F, F4, F41
Effects of Funding Portfolios on the Credit Supply of Canadian Banks Staff Working Paper 2015-10 H. Evren Damar, Césaire Meh, Yaz Terajima This paper studies how banks simultaneously manage the two sides of their balance sheet and its implications for bank risk taking and real economic activity. First, we analyze how changes in funding affect the supply of bank loans. Content Type(s): Staff research, Staff working papers Research Topic(s): Financial institutions, Financial stability, Financial system regulation and policies, Monetary policy implementation JEL Code(s): E, E5, E52, G, G2, G21
The Effects of Budget Rules on Fiscal Performance and Macroeconomic Stabilization Staff Working Paper 1997-15 Jonathan Millar Budget rules can be defined as legislated or constitutional constraints on government deficits, taxes, expenditures, or debt. This paper reviews the budget rules recently legislated in six of Canada's provinces and both of its territories, as well as budget rules in other OECD countries. Content Type(s): Staff research, Staff working papers Research Topic(s): Fiscal policy JEL Code(s): E, E6, E62, H, H3, H6, H61
Firm-Specific Shocks and Aggregate Fluctuations Staff Working Paper 2016-51 Leonid Karasik, Danny Leung, Ben Tomlin In order to understand what drives aggregate fluctuations, many macroeconomic models point to aggregate shocks and discount the contribution of firm-specific shocks. Recent research from other developed countries, however, has found that aggregate fluctuations are in part driven by idiosyncratic shocks to large firms. Content Type(s): Staff research, Staff working papers Research Topic(s): Business fluctuations and cycles, Firm dynamics, Market structure and pricing JEL Code(s): E, E2, E22, E23, E24, E3, L, L6
Does the Buck Stop Here? A Comparison of Withdrawals from Money Market Mutual Funds with Floating and Constant Share Prices Staff Working Paper 2012-25 Jonathan Witmer Recent reform proposals call for an elimination of the constant net asset value (NAV) or “buck” in money market mutual funds to reduce the occurrence of runs. Outside the United States, there are several countries that have money market mutual funds with and without constant NAVs. Content Type(s): Staff research, Staff working papers Research Topic(s): Financial markets, Financial stability, Market structure and pricing JEL Code(s): F, F3, F30, G, G0, G01, G1, G18, G2, G20
February 2, 2012 Banking Crises and Contagion: Empirical Evidence Financial System Review - December 2002 Eric Santor Content Type(s): Publications, Financial System Review articles
Financial Crisis Interventions Staff Working Paper 2016-29 Josef Schroth This paper develops a model of an economy where bank credit supports both productive investment and individual consumption smoothing in the face of idiosyncratic income risk. Bank credit is constrained by bank equity capital. Content Type(s): Staff research, Staff working papers Research Topic(s): Credit and credit aggregates, Financial stability, Financial system regulation and policies, Lender of last resort JEL Code(s): E, E1, E13, E3, E32, E4, E44
Household financial vulnerabilities and physical climate risks Staff Analytical Note 2021-19 Thibaut Duprey, Colin Jones, Callie Symmers, Geneviève Vallée Natural disasters occur more often than before, potentially exposing households to financial distress. We study the intersection between household financial vulnerabilities and severe weather events. Content Type(s): Staff research, Staff analytical notes Research Topic(s): Climate change, Credit and credit aggregates, Financial stability, Housing, Recent economic and financial developments JEL Code(s): C, C2, C21, C3, C38, D, D1, D14, Q, Q5, Q54
Market Size and Entry in International Trade: Product Versus Firm Fixed Costs Staff Working Paper 2018-43 Walter Steingress This paper develops a theoretical framework to infer the nature of fixed costs from the relationship between entry patterns in international markets and destination market size. If fixed costs are at the firm level, firms take advantage of an intrafirm spillover by expanding firm-level product range (scope). Content Type(s): Staff research, Staff working papers Research Topic(s): Firm dynamics, International topics, Trade integration JEL Code(s): F, F1, F12, F14, F2, F23