Labour markets
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Restructuring in the Canadian Economy: A Survey of Firms
The regional offices of the Bank conducted a survey of 140 Canadian companies (representing all non-government sectors of the economy) to study the effects of restructuring (defined as a major change in the way firms do business). -
Employment Effects of Restructuring in the Public Sector in North America
This paper examines whether restructuring in the public sector contributed to the slower cyclical recovery in Canada than in the United States during the 1990s. Changes in public sector employment are used to investigate this question. -
How Rigid Are Nominal-Wage Rates?
This study examines the effect of nominal-wage rigidities on wage growth in Canada using a hazard model and micro data for union contracts. The hazard model is specified in a way that allows considerable flexibility in the shape of the estimated notional wage-change distribution. -
Downward Nominal-Wage Rigidity: Micro Evidence from Tobit Models
This paper uses Tobit models and data for union contracts to examine the extent of downward nominal-wage rigidity in Canada. To be consistent with important stylized facts, the models allow the variance of the notional wage-change distribution to be time-varying and test for menu-cost effects. -
August 15, 2000
Restructuring in the Canadian Economy: A Survey of Firms
Towards the end of the 1980s and into the early 1990s, the Canadian economy experienced a number of structural changes. These included free trade agreements (both the FTA and NAFTA), significant technological advances, deregulation in many sectors of the economy, the arrival of large, U.S.-based retailers, and the introduction of the GST. -
Employment Effects Of Nominal-Wage Rigidity: An Examination Using Wage-Settlements Data
The argument advocating a moderate level of inflation based on the downward nominal-wage rigidity (DNWR) hypothesis rests on three factors: its presence, extent, and negative impact in the labour market. This paper focuses on the employment effect of DNWR. -
The Employment Costs of Downward Nominal-Wage Rigidity
In this paper, we use firm-level wage and employment data to address whether there is evidence of downward nominal-wage rigidity, and whether that rigidity is associated with a reduction in employment. We describe an estimation bias that can result when estimating reduced-form wage and employment equations and suggest a way of controlling for that bias. […] -
Dynamic Employment and Hours Effects of Government Spending Shocks
In this paper, we analyze the dynamic behaviour of employment and hours worked per worker in a stochastic general equilibrium model with a matching mechanism between vacancies and unemployed workers. The model is estimated for the United States using the Generalized Methods of Moments (GMM) estimation technique. An increase in government spending raises hours worked […] -
Can a Matching Model Explain the Long-Run Increase in Canada's Unemployment Rate?
The authors construct a simple general equilibrium model of unemployment and calibrate it to the Canadian economy. Job creation and destruction are endogenous. In this model, they consider several potential factors that could contribute to the long-run increase in the Canadian unempoloyment rate: a more generous unemployment insurance system, higher layoff costs, higher discretionary taxes, […]