E - Macroeconomics and Monetary Economics

• Corporate Bond Spreads and the Business Cycle

  Staff Working Paper 2002-15 Zhiwei Zhang

  This paper examines the predictive power of credit spreads from the corporate bond market. The high-yield bond spread and investment-grade spread can explain 68 per cent and 42 per cent of output variations one year ahead, while the term spread based on government debts can explain only 12 per cent of them.

  Content Type(s): Staff research, Staff working papers Topic(s): Financial markets, Monetary and financial indicators, Monetary policy transmission JEL Code(s): E, E3, E5, G, G1

• Entrepreneurship, Inequality, and Taxation

  Staff Working Paper 2002-14 Césaire Meh

  This paper confirms the conjecture that the evaluation of tax policy leads to very different conclusions once the role of entrepreneurs is considered. Contrary to previous literature, the author finds that switching from a progressive to a proportional income tax system has a negligible effect on wealth inequality in the United States.

  Content Type(s): Staff research, Staff working papers Topic(s): Economic models, Fiscal policy JEL Code(s): D, D3, D31, E, E6, E62, H, H2, H20, H23

• La fiabilité des estimations de l'écart de production au Canada

  Staff Working Paper 2002-10 Jean-Philippe Cayen, Simon van Norden

  In this paper, we measure, with Canadian data, the scope of the revisions to real-time estimates of the output gap generated with several univariate and multivariate techniques. We also make an empirical evaluation of the usefulness of the output gap estimates for predicting inflation.

  Content Type(s): Staff research, Staff working papers Topic(s): Potential output JEL Code(s): E, E3, E32

• Currency Fluctuations, Liability Dollarization, and the Choice of Exchange Rate Regimes in Emerging Markets

  Staff Working Paper 2002-6 Patrick Osakwe

  Traditional models of exchange rate regimes ignore the destabilizing effects of sharp and unanticipated exchange rate movements.

  Content Type(s): Staff research, Staff working papers Topic(s): Exchange rate regimes JEL Code(s): E, E5, E52, F, F3, F31, F4, F41

• Taylor Rules in the Quarterly Projection Model

  Staff Working Paper 2002-1 Ben Fung, Dinah Maclean, Jamie Armour

  In recent years, there has been a lot of interest in Taylor-type rules. Evidence in the literature suggests that Taylor-type rules are optimal in a number of models and are fairly robust across different models.

  Content Type(s): Staff research, Staff working papers Topic(s): Economic models, Monetary policy and uncertainty, Monetary policy framework JEL Code(s): E, E5, E52