Business fluctuations and cycles
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September 21, 2015 Riding the Commodity Cycle: Resources and the Canadian Economy
Governor Poloz speaks about cycles in commodity prices and how Canada has used its endowment of natural resources to build a prosperous economy. -
The Carrot and the Stick: The Business Cycle Implications of Incentive Pay in the Labor Search Model
This paper considers a real business cycle model with labor search frictions where two types of incentive pay are explicitly introduced following the insights from the micro literature on performance pay (e.g. Lazear, 1986). -
The Endogenous Relative Price of Investment
This paper takes a full-information model-based approach to evaluate the link between investment-specific technology and the inverse of the relative price of investment. The two-sector model presented includes monopolistic competition where firms can vary the markup charged on their product depending on the number of firms competing. -
Model Averaging in Markov-Switching Models: Predicting National Recessions with Regional Data
This paper introduces new weighting schemes for model averaging when one is interested in combining discrete forecasts from competing Markov-switching models. In particular, we extend two existing classes of combination schemes – Bayesian (static) model averaging and dynamic model averaging – so as to explicitly reflect the objective of forecasting a discrete outcome. -
International Transmission of Credit Shocks in an Equilibrium Model with Production Heterogeneity
Many policy-makers and researchers view the recent financial and real economic crises across North America, Europe and beyond as a global phenomenon. Some have argued that this global recession has a common source: the U.S. financial crisis. -
May 19, 2015 The Way Home: Reading the Economic Signs
Governor Poloz discusses some key indicators the Bank is watching as the Canadian economy heads toward sustainable balanced growth. -
Securitization under Asymmetric Information over the Business Cycle
This paper studies the efficiency of financial intermediation through securitization in a model with heterogeneous investment projects and asymmetric information about the quality of securitized assets. I show that when retaining part of the risk, the issuer of securitized assets may credibly signal its quality. -
January 13, 2015 Drilling Down - Understanding Oil Prices and Their Economic Impact
Deputy Governor Timothy Lane discusses the causes of the recent drop in oil prices and its effects on the global and Canadian economies.