Jonathan Swarbrick is a Senior Economist in the Model Development Division of the Canadian Economic Analysis Department. His research interests include macroeconomic theory, financial economics, and monetary economics. Jonathan received his Ph.D. from the University of Surrey, UK, in 2017.
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.
We use the Terms-of-Trade Economic Model (ToTEM) to conduct demand- and supply-driven simulations, both of which deliver weakness in Canadian non-commodity exports relative to foreign activity in line with recent data.