December 22, 2003
Find Bank of Canada research by keyword, author, content type, JEL code, topic or date of publication.
Receive notification by email whenever new research is added to the website.
2333
result(s)
December 21, 2003
The Rationale for Cross-Border Listings
Technological progress and the liberalization of capital flows have both contributed to the considerable changes in global equity markets over the past few decades. Yet obstacles to international capital flows still exist, leading to segmentation of markets and creating incentives for corporate managers to adopt financial policies such as international cross-listing. In exploring the costs and benefits of cross-listing, Chouinard and D'Souza find that U.S. exchanges are attracting an increasing share of cross-listed firms. The empirical studies they review suggest that the cost of equity capital declines following a foreign listing as a result of lower transactions costs or an improvement in the quality and quantity of firm-specific information available to investors. As well, informational asymmetries across countries prevent simultaneous price discovery across exchanges.
Content Type(s):
Publications,
Bank of Canada Review articles
Topic(s):
Financial markets,
International topics
Common Trends and Common Cycles in Canadian Sectoral Output
Staff Working Paper 2003-44
Francisco Barillas,
Christoph Schleicher
The authors examine evidence of long- and short-run co-movement in Canadian sectoral output data. Their framework builds on a vector-error-correction representation that allows them to test for and compute full-information maximum-likelihood estimates of models with codependent cycle restrictions.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Business fluctuations and cycles,
Econometric and statistical methods
JEL Code(s):
C,
C1,
C15,
C2,
C22,
C3,
C32,
E,
E3,
E32
Why Does Private Consumption Rise After a Government Spending Shock?
Staff Working Paper 2003-43
Hafedh Bouakez,
Nooman Rebei
Recent empirical evidence suggests that private consumption is crowded-in by government spending. This outcome violates existing macroeconomic theory, according to which the negative wealth effect brought about by a rise in public expenditure should decrease consumption.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Business fluctuations and cycles,
Economic models,
Fiscal policy
JEL Code(s):
E,
E3,
E32,
E6,
E62
A Structural VAR Approach to the Intertemporal Model of the Current Account
Staff Working Paper 2003-42
Takashi Kano
The intertemporal current account approach predicts that the current account of a small open economy is independent of global shocks, and that responses of the current account to country-specific shocks depend on the persistence of the shocks. The author shows that these predictions impose cross-equation restrictions (CERS) on a structural vector autoregression (SVAR).
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Balance of payments and components,
Monetary aggregates
JEL Code(s):
F,
F3,
F32,
F4,
F41
Anatomy of a Twin Crisis
Staff Working Paper 2003-41
Raphael Solomon
The author presents a model of a twin crisis, in which foreign and domestic residents play a banking game. Both "honest" and run equilibria of the post-deposit subgame exist; some run equilibria lead to a currency crisis, as agents convert domestic currency to foreign currency.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Exchange rates,
Financial institutions
JEL Code(s):
E,
E5,
E58,
F,
F3,
F30,
G,
G2,
G21
Poignée de main invisible et persistance des cycles économiques : une revue de la littérature
Staff Working Paper 2003-40
Christian Calmès
The author explains how self-enforcing labour contracts can enhance the performance of macroeconomic models. He exposes the benefits of using these dynamic contracts to account for some puzzling macroeconomic facts regarding the dynamics and persistence of employment, consumption and output.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Business fluctuations and cycles,
Economic models
JEL Code(s):
E,
E1,
E12,
E4,
E49,
J,
J3,
J30,
J31,
J4,
J41
Alternative Targeting Regimes, Transmission Lags, and the Exchange Rate Channel
Staff Working Paper 2003-39
Jean-Paul Lam
Using a closed-economy model, Jensen (2002) and Walsh (2003) have, respectively, shown that a policy regime that optimally targets nominal income growth (NIT) or the change in the output gap (SLT) outperforms a regime that targets inflation, because NIT and SLT induce more inertia in the actions of the central bank, effectively replicating the outcome obtained under precommitment. The author obtains a very different result when the analysis is extended to open-economy models.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Exchange rates,
Monetary policy framework
JEL Code(s):
E,
E5,
E52,
E58
Simple Monetary Policy Rules in an Open-Economy, Limited-Participation Model
Staff Working Paper 2003-38
Scott Hendry,
Wai-Ming Ho,
Kevin Moran
The authors assess the stabilization properties of simple monetary policy rules within the context of a small open-economy model constructed around the limited-participation assumption and calibrated to salient features of the Canadian economy. By relying on limited participation as the main nominal friction that affects the artificial economy, the authors provide an important check of the robustness of the results obtained using alternative environments in the literature on monetary policy rules, most notably the now-standard "New Keynesian" paradigm that emphasizes rigidities in the price-setting mechanism.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Monetary policy framework,
Monetary policy transmission
JEL Code(s):
E,
E4,
E44,
E5,
E52,
E58,
F,
F3,
F31
Financial Constraints and Investment: Assessing the Impact of a World Bank Loan Program on Small and Medium-Sized Enterprises in Sri Lanka
Staff Working Paper 2003-37
Varouj Aivazian,
Dipak Mazumdar,
Eric Santor
The authors examine the investment behaviour of a sample of small, credit-constrained firms in Sri Lanka. Using a unique panel-data set, they analyze and compare the activities of two groups of small firms distinguished by their different access to financing; one group consists of firms with heavily subsidized loans from the World Bank, and the other consists of firms without such subsidies.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Development economics
JEL Code(s):
G,
G0,
G00,
O,
O1,
O16