Dinah Maclean - Latest
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June 21, 2006
The Bank of Canada’s Role in the Oversight of Clearing and Settlement Systems
This article sets out the Bank’s mandate for regulatory oversight of clearing and settlement systems, the strategy that is followed, and the key activities relevant to the conduct of oversight. -
December 25, 2004
The Bank of Canada as Lender of Last Resort
As the ultimate provider of Canadian-dollar liquidity to the financial system, the Bank of Canada has the unique capacity to create Canadian-dollar claims on the central bank and the power to make secured loans or advances to chartered banks and other members of the Canadian Payments Association. The Bank supplies overnight credit on a routine basis through the Standing Liquidity Facility (SLF) to direct participants in the Large Value Transfer System, and Emergency Lending Assistance (ELA) to solvent deposit-taking institutions that require more substantial and prolonged credit. The authors review the policy framework that guides the Bank's lender-of-last-resort function, including the key issues, terms and conditions, and eligibility criteria associated with its SLF and ELA activities. Also discussed are foreign currency ELA, the relationship between SLF and ELA, systemic risk and Bank of Canada intervention, and the potential provision of liquidity to major clearing and settlement systems. -
Taylor Rules in the Quarterly Projection Model
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. -
August 15, 2001
Analyzing the Monetary Aggregates
In recent years, the Bank has put renewed emphasis on analyzing monetary variables and on developing models that incorporate money as an active part of the transmission mechanism. In this article, Dinah Maclean describes how the monetary aggregates are used in the formulation of monetary policy analysis at the Bank, outlining the key tools and models used. The most important money-based model currently in use is the M1-VECM. In this model, deviations in the money supply from the long-term demand for money cause changes in inflation. The author briefly describes the "active-money" paradigm underlying this model and explains the key equations within it. Other simpler empirical models are also outlined, including single-equation indicator models for output based on the narrow aggregates, a neural network, and a model based on the broader aggregate M2++. A detailed technical annex provides details on model equations and coefficient values. -
Lagging Productivity Growth in the Service Sector: Mismeasurement, Mismanagement or Misinformation?
While the service sector has been growing rapidly as a share of total output, aggregate productivity growth has generally lagged behind that of the goods sector. In this report, the author assesses a range of explanations for lagging service sector productivity growth. -
November 11, 1996
Productivity growth in the commercial service sector
For over three decades, measured productivity growth in the commercial service sector has consistently lagged behind that of the goods-producing sector. At the same time, the service sector has greatly expanded its share of output and employment. Some commentators have suggested that this trend will reduce growth in total economy-wide productivity. In this article, the author reviews recent trends in productivity growth in services and the main factors affecting it. She concludes that services will likely contribute to increases in future productivity growth. There is a great diversity of experience within the service sector. While productivity is falling in some industries, factors such as technological change, deregulation, and increased competition have helped to increase it in others. Moreover, much of the growth in commercial service output is occurring in those industries with relatively high productivity growth. Difficulties in measuring output for some service activities may also be resulting in underestimation of output and productivity growth. To the extent that services are used as intermediate inputs in the production of goods, underestimating productivity growth in the service industry would cause an offsetting overestimation of productivity growth in goods-producing industries. -
The Role of House Prices in Regional Inflation Disparities
Theoretically, house prices will reveal greater disparities between regions than prices for more easily tradable goods and services. This contributes to regional disparities in inflation. In this report the author reviews a range of factors that are likely to cause greater disparities in house price inflation than in the price inflation of other goods and […]