June 21, 2006 Using the Contingent Claims Approach to Assess Credit Risk in the Canadian Business Sector Financial System Review - June 2006 Michal Kozak, Meyer Aaron, Céline Gauthier Content Type(s): Publications, Financial System Review articles
The “Too Big to Fail” Subsidy in Canada: Some Estimates Staff Working Paper 2018-9 Patricia Palhau Mora Implicit government guarantees of banking-sector liabilities reduce market discipline by private sector stakeholders and temper the risk sensitivity of funding costs. This potentially increases the likelihood of bailouts from taxpayers, especially in the absence of effective resolution frameworks. Content Type(s): Staff research, Staff working papers Research Topic(s): Financial institutions, Financial stability JEL Code(s): G, G1, G13, G2, G21, G28
Unintended consequences of liquidity regulation Staff Analytical Note 2025-28 Omar Abdelrahman, Josef Schroth When a bank holds a lot of safe assets, it is well situated to deal with funding stress. But when all banks hold a lot of safe assets, a pecuniary externality implies that their (wholesale) funding costs increase. This reduces banks’ ability to hold capital buffers and thus, paradoxically, increases the frequency of funding stress. Content Type(s): Staff research, Staff analytical notes Research Topic(s): Credit and credit aggregates, Financial stability, Financial system regulation and policies JEL Code(s): E, E4, E44, E6, G, G2, G21, G28
December 11, 2007 The Zero Bound on Nominal Interest Rates: Implications for Monetary Policy Bank of Canada Review - Winter 2007-2008 Claude Lavoie, Stephen Murchison One of the most important factors that must be considered if countries are thinking about lowering the target level of inflation much below 2 per cent is the zero interest bound. Targeting inflation rates that are too low, the authors note, may restrict the ability of monetary policy to respond to economic shocks by limiting the amount by which interest rates can be eased. Content Type(s): Publications, Bank of Canada Review articles Research Topic(s): Inflation: costs and benefits, Interest rates, Monetary policy implementation
The Neutral Interest Rate: Past, Present and Future Staff Discussion Paper 2024-3 Matteo Cacciatore, Bruno Feunou, Galip Kemal Ozhan The decline in safe real interest rates over the past three decades has reignited discussions on the neutral real interest rate, known as R*. We address the determinants and estimation methods of R*, as well as the factors influencing its decline and its future trajectory. Content Type(s): Staff research, Staff discussion papers Research Topic(s): Interest rates, Monetary policy, Monetary policy framework JEL Code(s): E, E4, E43, E5, E52, E6, E62
January 15, 2008 Bank of Canada Review - Winter 2007-2008 Cover page Roman Antoninianus The coins form part of the National Currency Collection of the Bank of Canada. Photography by Gord Carter, Ottawa. Content Type(s): Publications, Bank of Canada Review
Self-Enforcing Labour Contracts and the Dynamics Puzzle Staff Working Paper 2005-1 Christian Calmès To properly account for the dynamics of key macroeconomic variables, researchers incorporate various internal-propagation mechanisms in their models. Content Type(s): Staff research, Staff working papers Research Topic(s): Business fluctuations and cycles, Economic models, Labour markets JEL Code(s): E, E1, E12, E4, E49, J, J3, J30, J31, J4, J41
Digitalization: Definition and Measurement Staff Discussion Paper 2023-20 Guyllaume Faucher, Stéphanie Houle This paper provides an overview of digitalization and its economic implications. We assess the scope of digitalization in Canada as well as the challenges related to its measurement. Content Type(s): Staff research, Staff discussion papers Research Topic(s): Digitalization, Potential output JEL Code(s): E, E0, E01, O, O3, O33, O5, O51
Fractional Cointegration and the Demand for M1 Staff Working Paper 2000-13 Greg Tkacz Using wavelets, the author estimates the fractional order of integration of a common long-run money-demand relationship whose parameters are obtained from a full-information maximum-likelihood procedure. Content Type(s): Staff research, Staff working papers Research Topic(s): Econometric and statistical methods, Monetary aggregates JEL Code(s): C, C1, C13, E, E4, E41
The Impact of Unanticipated Defaults in Canada's Large Value Transfer System Staff Working Paper 2005-25 Darcey McVanel Canada's Large Value Transfer System (LVTS) is designed to meet international risk-proofing standards at a minimum cost to participants in terms of collateral requirements. Content Type(s): Staff research, Staff working papers Research Topic(s): Financial institutions, Payment clearing and settlement systems JEL Code(s): E, E4, E44, E47, G, G2, G21