Monthly Archives: October 2013
Gross Saving: A Comparison
I’m teaching public finance this term and just finished a discussion of the economic effects of income taxation on saving using a simple two period model of inter-temporal consumption. I rounded out the discussion with a comparison of personal savings rates between Canada and the United States and how their savings rates have converged since […]
Forward guidance and the term structure in New Keynesian models
Take a standard New Keynesian macroeconomic model, where the central bank sets the one-period interest rate. Now let's hit it with an unexpected shock. For simplicity and concreteness, let the shock be a reduction in government spending that will last for n periods, after which government spending will return to normal. So government spending was […]
Opposition to two FTAs: Canada/US 1987 vs Canada/EU 2013
I don't understand this. In 1987 Canada negotiated a Free Trade Agreement with the US. In 2013 Canada negotiates a Free Trade Agreement with the EU. The US and the EU are both very big advanced economies. Wikipedia confirms my memory of 1987: "The debate in Canada over whether to implement the negotiated agreement was […]
Teaching tariffs vs taxes in a small open economy
I taught my first year students the effects of an import tariff in a small open economy. I used the standard diagram (from Mankiw, Kneebone and McKenzie). It looks like this:
Debt, Default and Leadership
Well I honestly thought the US debt ceiling crisis would be resolved by today given the past examples of American political theater when it comes to fiscal issues. As I write this morning, it seems that the US is heading towards defaulting on some of its debt interest payments. It appears to me that the […]
What’s a Billion?
I have finally been able to catch my breath this week and ponder the situation in Ontario over the report on the final cost of cancelling two natural gas electricity plants in the Oakville-Mississauga area ostensibly in order to retain seats for the Ontario Liberal government given local opposition to the plants. The Ontario auditor […]
What should universities do to accommodate students with disabilities?
This is a guest post written by frequent WCI commentator Rachel Goddyn: My husband is a math professor. Recently at social gatherings with his fellow academics, there has been a lot of discussion of accommodations for people with disabilities. We have a 30 year old son with intellectual disabilities, and I do lots of volunteer […]
Trade, Growth and … Brazil
In a recent address on global growth and Canadian export prospects to the Economic Club of Canada, the Bank of Canada’s Tiff Macklem noted that Canada’s share of world trade has been in decline for over a decade and that the loss of global trade share has been the second highest of the G-20. Given […]
Policy rules and borrowing degrees of freedom.
In the olden days, as Peter Dorman notes, macro models would contain variables like M (or r), G, and T (or t) for monetary and fiscal policy. Nowadays they usually contain a monetary policy rule, and sometimes a fiscal policy rule too. Like a Taylor Rule, for example. [Update: but see my old post on […]
Private debt, public debt, and continuity
Let me try it this way. Here's Brad DeLong: "So, by continuity, somewhere between policies of austerity that that produce deflationary depression due to an excess demand for safe assets and policies of fiscal license that produce inflationary boom caused by an excess supply of government debt, there must be a sweet spot: enough new […]
Worthwhile Canadian Initiative 
Recent Comments