Economic models

• Can the Business Outlook Survey Help Improve Estimates of the Canadian Output Gap?

  Staff Discussion Paper 2020-14 Calista Cheung, Luke Frymire, Lise Pichette

  We investigate whether questions in the Bank of Canada’s Business Outlook Survey can provide useful signals for the output gap.

  Content Type(s): Staff research, Staff discussion papers Topic(s): Business fluctuations and cycles, Central bank research, Economic models, Monetary policy and uncertainty, Potential output JEL Code(s): E, E3

• Towards a HANK Model for Canada: Estimating a Canadian Income Process

  Staff Discussion Paper 2020-13 Iskander Karibzhanov

  How might one simulate a million realistic income paths and compute their statistical moments in under a second? Using CUDA-based methods to estimate the Canadian earnings process, I find that the distribution of labour income growth is sharply peaked with heavy tails—similar to that in the United States.

  Content Type(s): Staff research, Staff discussion papers Topic(s): Economic models, Labour markets JEL Code(s): D, D3, D31, E, E2, E24, J, J3, J31

• 2020 US Neutral Rate Assessment

  Staff Discussion Paper 2020-12 James Bootsma, Thomas J. Carter, Xin Scott Chen, Christopher Hajzler, Argyn Toktamyssov

  This paper presents Bank of Canada staff’s current assessment of the US neutral rate, along with a newly developed set of models on which that assessment is based. The overall assessment is that the US neutral rate currently lies in a range of 1.75 to 2.75 percent.

  Content Type(s): Staff research, Staff discussion papers Topic(s): Economic models, Interest rates, Monetary policy JEL Code(s): E, E4, E40, E43, E5, E50, E52, E58, F, F4, F41