E22 - Capital; Investment; Capacity - Bank of Canada
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Bank of Canada RSS Feedsen2024-03-28T13:16:53+00:00The Canadian Neutral Rate of Interest through the Lens of an Overlapping-Generations Model
https://www.bankofcanada.ca/2023/02/staff-discussion-paper-2023-5/
We use a small open economy model with overlapping generations to evaluate secular dynamics of the neutral rate in Canada from 1980 to 2018. We find that changes in both foreign and domestic factors resulted in a protracted decline in the neutral rate.2023-02-21T16:42:36+00:00enThe Canadian Neutral Rate of Interest through the Lens of an Overlapping-Generations Model2023-02-21Economic modelsInterest ratesMonetary policyStaff Discussion Paper 2023-5https://www.bankofcanada.ca/wp-content/uploads/2023/02/sdp2023-5.pdfStaff Discussion Paper 2023-5Martin KunclDmitry MatveevFebruary 2023EE2E21E22E4E43E5E50E52E58FF4F41Financial Constraints and Corporate Investment in China
https://www.bankofcanada.ca/2022/12/staff-discussion-paper-2022-22/
Financial constraints deter firms from pursuing optimal investment plans. In China, we find privately owned firms face greater financial constraints than state-owned enterprises (SOEs). This can be explained by our finding that lenders appear less concerned about the credit risk of SOEs, which causes distortions in the allocation of credit.2022-12-20T13:46:58+00:00enFinancial Constraints and Corporate Investment in China2022-12-20Financial marketsFirm dynamicsStaff Discussion Paper 2022-22https://www.bankofcanada.ca/wp-content/uploads/2022/12/sdp2022-22.pdfFinancial Constraints and Corporate Investment in ChinaKun MoMichel SoudanDecember 2022EE2E22GG1G3Endogenous Liquidity and Capital Reallocation
https://www.bankofcanada.ca/2022/06/staff-working-paper-2022-27/
We study economies where firms acquire capital in primary markets then retrade it in secondary markets after information on idiosyncratic productivity arrives. Our secondary markets incorporate bilateral trade with search, bargaining and liquidity frictions.2022-06-17T09:32:18+00:00enEndogenous Liquidity and Capital Reallocation2022-06-17Business fluctuations and cyclesMonetary policyStaff Working Paper 2022-27https://www.bankofcanada.ca/wp-content/uploads/2022/06/swp2022-27.pdfEndogenous Liquidity and Capital ReallocationWei CuiRandall WrightYu ZhuJune 2022EE2E22E4E44Heterogeneity and Monetary Policy: A Thematic Review
https://www.bankofcanada.ca/2022/02/staff-discussion-paper-2022-2/
The theory that rich economic diversity of businesses and households both affects and is shaped by economy-wide fluctuations has strong implications for monetary policy. This review places these insights in a Canadian context.2022-02-02T09:25:14+00:00enHeterogeneity and Monetary Policy: A Thematic Review2022-02-02Economic modelsMonetary policy and uncertaintyMonetary policy transmissionStaff Discussion Paper 2022-2https://www.bankofcanada.ca/wp-content/uploads/2022/02/sdp2022-2.pdfHeterogeneity and Monetary Policy: A Thematic ReviewFelipe AlvesChristian BustamanteXing GuoKatya KartashovaSoyoung LeeThomas Michael PughKurt SeeYaz TerajimaAlexander UeberfeldtFebruary 2022DD2D25D3D31EE2E22E24E5E50E52Identifying Aggregate Shocks with Micro-level Heterogeneity: Financial Shocks and Investment Fluctuation
https://www.bankofcanada.ca/2020/05/staff-working-paper-2020-17/
This paper identifies aggregate financial shocks and quantifies their effects on business investment based on an estimated DSGE model with firm-level heterogeneity. On average, financial shocks contribute only 3% of the variation in U.S. public firms’ aggregate investment.2020-05-19T09:07:43+00:00enIdentifying Aggregate Shocks with Micro-level Heterogeneity: Financial Shocks and Investment Fluctuation2020-05-19Business fluctuations and cyclesFirm dynamicsStaff Working Paper 2020-17https://www.bankofcanada.ca/wp-content/uploads/2020/05/swp2020-17.pdfStaff Working Paper 2020-17Xing GuoMay 2020EE1E12E2E22GG3G31G32What Do Survey Data Tell Us About US Businesses?
https://www.bankofcanada.ca/2019/12/staff-working-paper-2019-45/
This paper examines the reliability of survey data on business incomes, valuations, and rates of return, which are key inputs for studies of wealth inequality and entrepreneurial choice.2019-12-05T10:43:32+00:00enWhat Do Survey Data Tell Us About US Businesses?2019-12-05Business fluctuations and cyclesFirm dynamicsStaff Working Paper 2019-45https://www.bankofcanada.ca/wp-content/uploads/2019/12/swp2019-45.pdfWhat Do Survey Data Tell Us About US Businesses?Anmol BhandariSerdar BirinciEllen McGrattanKurt SeeDecember 2019CC8C83EE2E22HH2H25Lending Standards, Productivity and Credit Crunches
https://www.bankofcanada.ca/2019/07/staff-working-paper-2019-25/
We propose a macroeconomic model in which adverse selection in investment drives the amplification of macroeconomic fluctuations, in line with prominent roles played by the credit crunch and collapse of the asset-backed security market in the financial crisis.2019-07-26T12:33:44+00:00enLending Standards, Productivity and Credit Crunches2019-07-26Business fluctuations and cyclesCredit and credit aggregatesFinancial marketsFinancial stabilityInterest ratesProductivityStaff Working Paper 2019-25https://www.bankofcanada.ca/wp-content/uploads/2019/07/swp2019-25.pdfLending Standards, Productivity and Credit CrunchesJonathan SwarbrickJuly 2019EE2E22E3E32E4E44GG0G01Potential Output in Canada: 2019 Reassessment
https://www.bankofcanada.ca/2019/04/staff-analytical-note-2019-10/
Potential output is expected to grow on average at 1.8 per cent over 2019–21 and at 1.9 per cent in 2022. While the contribution of trend labour input to potential output growth is expected to decrease between 2019 and 2022, the contribution of trend labour productivity is projected to increase.2019-04-17T11:03:16+00:00enPotential Output in Canada: 2019 Reassessment2019-04-17Frictional Capital Reallocation I: Ex Ante Heterogeneity
https://www.bankofcanada.ca/2019/01/staff-working-paper-2019-4/
This paper studies dynamic general equilibrium models where firms trade capital in frictional markets. Gains from trade arise due to ex ante heterogeneity: some firms are better at investment, so they build capital in the primary market; others acquire it in the secondary market.2019-01-14T10:07:35+00:00enFrictional Capital Reallocation I: Ex Ante Heterogeneity2019-01-14Monetary policyStaff Working Paper 2019-4https://www.bankofcanada.ca/wp-content/uploads/2019/01/swp2019-4.pdfFrictional Capital Reallocation I: Ex Ante HeterogeneityRandall WrightSylvia Xiaolin XiaoYu ZhuJanuary 2019EE2E22E4E44Can Capital Deepening Explain the Global Decline in Labor’s Share?
https://www.bankofcanada.ca/2019/01/staff-working-paper-2019-3/
We estimate an aggregate elasticity of substitution between capital and labor near or below one, which implies that capital deepening cannot explain the global decline in labor's share. Our methodology derives from transition paths in the neo-classical growth model.2019-01-14T09:53:44+00:00enCan Capital Deepening Explain the Global Decline in Labor’s Share?2019-01-14Firm dynamicsInternational topicsLabour marketsStaff Working Paper 2019-3https://www.bankofcanada.ca/wp-content/uploads/2019/01/swp2019-3.pdfCan Capital Deepening Explain the Global Decline in Labor’s Share?Andrew GloverJacob ShortJanuary 2019EE1E13E2E22E25JJ3