Business fluctuations and cycles

• Search Frictions, Financial Frictions and Labour Market Fluctuations in Emerging Markets

  Staff Working Paper 2014-35 Sumru Altug, Serdar Kabaca

  This paper examines the role of the extensive and intensive margins of labour input in the context of a business cycle model with a financial friction. We document significant variation in the hours worked per worker for many emerging-market economies. Both employment and hours worked per worker are positively correlated with each other and with output.

  Content Type(s): Staff research, Staff working papers Topic(s): Business fluctuations and cycles, Development economics, Interest rates, International topics, Labour markets JEL Code(s): E, E4, E44, F, F4, F41, J, J4, J40

• Housework and Fiscal Expansions

  Staff Working Paper 2014-34 Stefano Gnocchi, Daniela Hauser, Evi Pappa

  We build an otherwise-standard business cycle model with housework, calibrated consistently with data on time use, in order to discipline consumption-hours complementarity and relate its strength to the size of fiscal multipliers.

  Content Type(s): Staff research, Staff working papers Topic(s): Business fluctuations and cycles, Fiscal policy JEL Code(s): E, E2, E24, E3, E32, E5, E52, E6, E62

• Labor Market Participation, Unemployment and Monetary Policy

  Staff Working Paper 2014-9 Alessia Campolmi, Stefano Gnocchi

  We incorporate a participation decision in a standard New Keynesian model with matching frictions and show that treating the labor force as constant leads to incorrect evaluation of alternative policies.

  Content Type(s): Staff research, Staff working papers Topic(s): Business fluctuations and cycles, Labour markets, Monetary policy transmission JEL Code(s): E, E2, E24, E3, E32, E5, E52

• Technology Shocks, Labour Mobility and Aggregate Fluctuations

  Staff Working Paper 2014-4 Daniela Hauser

  We provide evidence regarding the dynamic behaviour of net labour flows across U.S. states in response to a positive technology shock. Technology shocks are identified as disturbances that increase relative state productivity in the long run for 226 state pairs, encompassing 80 per cent of labour flows across U.S. states in the 1976 - 2008 period.

  Content Type(s): Staff research, Staff working papers Topic(s): Business fluctuations and cycles, Labour markets JEL Code(s): E, E2, E24, E3, E32, J, J6, J61

• 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 Topic(s): Business fluctuations and cycles, Monetary policy implementation, Monetary policy transmission JEL Code(s): C, C9, D, D8, D84, E, E3, E5, E52

• High-Frequency Real Economic Activity Indicator for Canada

  Staff Working Paper 2013-42 Gitanjali Kumar

  I construct a weekly measure of real economic activity in Canada. Based on the work of Aruoba et al. (2009), the indicator is extracted as an unobserved component underlying the co-movement of four monthly observed real macroeconomic variables - employment, manufacturing sales, retail sales and GDP.

  Content Type(s): Staff research, Staff working papers Topic(s): Business fluctuations and cycles, Econometric and statistical methods JEL Code(s): C, C3, C38, E, E3, E32

• Unemployment Fluctuations in a Small Open-Economy Model with Segmented Labour Markets: The Case of Canada

  Staff Working Paper 2013-40 Yahong Zhang

  The recent financial crisis and subsequent recession have spurred great interest in the sources of unemployment fluctuations. Previous studies predominantly assume a single economy-wide labour market, and therefore abstract from differences across sectorspecific labour markets in the economy.

  Content Type(s): Staff research, Staff working papers Topic(s): Business fluctuations and cycles, Economic models, Labour markets JEL Code(s): E, E3, E32, E4, E44, J, J6

• ToTEM II: An Updated Version of the Bank of Canada’s Quarterly Projection Model

  Technical Report No. 100 José Dorich, Michael K. Johnston, Rhys R. Mendes, Stephen Murchison, Yang Zhang

  This report provides a detailed technical description of an updated version of the Terms-of-Trade Economic Model (ToTEM II), which replaced ToTEM (Murchison and Rennison 2006) in June 2011 as the Bank of Canada’s quarterly projection model for Canada.

  Content Type(s): Staff research, Technical reports Topic(s): Business fluctuations and cycles, Economic models JEL Code(s): E, E1, E17, E2, E20, E3, E30, E4, E40, E5, E50, F, F4, F41

• The Common Component of CPI: An Alternative Measure of Underlying Inflation for Canada

  Staff Working Paper 2013-35 Mikael Khan, Louis Morel, Patrick Sabourin

  In this paper, the authors propose a measure of underlying inflation for Canada obtained from estimating a monthly factor model on individual components of the CPI. This measure, labelled the common component of CPI, has intuitive appeal and a number of interesting features.

  Content Type(s): Staff research, Staff working papers Topic(s): Business fluctuations and cycles, Econometric and statistical methods, Inflation and prices, Monetary policy framework JEL Code(s): C, C1, E, E3, E31, E32, E5, E52, E58

• Endogenous Trade Participation with Incomplete Exchange Rate Pass-Through

  Staff Working Paper 2013-30 Yuko Imura

  This paper investigates the implications of endogenous trade participation for international business cycles, trade flow dynamics and exchange rate pass-through when price adjustments are staggered across firms.

  Content Type(s): Staff research, Staff working papers Topic(s): Business fluctuations and cycles, Exchange rates, International topics JEL Code(s): F, F1, F12, F4, F44