Category Finance
Who Gets What Federalism
The recent Mowat Centre report on Ontario’s fiscal gap with Ottawa and the lament that Ontario puts more into Confederation than it gets out brought to mind a poll done in 2005 by EKOS that showed that 51 percent of Canadians believed their province was putting more money into Confederation than it gets out. Of […]
Federal Budget Forecasting
What a difference just a few months can make in the world of federal government finance. Apparently, weak commodity prices and a slowing economy are playing such havoc with government finances that Thursday’s federal budget will show a downward revision of economic growth forecasts as well as a shortfall in revenue that will be addressed […]
Deposit insurance, bank runs, international currencies, and the inflation tax
Just a short post on one point about the recent Cyprus business. (It looks like Cyprus will impose a "one-time tax" on bank deposits rather than honour its deposit insurance.)
A monetary policy target can only be defeated by a better monetary policy target
"Monetary policy can cause bad things to happen in financial markets, which can cause bad things to happen in the rest of the economy. Therefore NGDP targeting is wrong." I made up that quote. But if I had to summarise M.C.K.'s long article in two short sentences, that is how I would do it.
Inheritance
Well, Ontario has a new finance minister – Charles Sousa – and according to the Toronto Star: “Charles Sousa, the two-term Mississauga South MPP who finished fifth in last month’s leadership race, will succeed the retiring Finance Minister Dwight Duncan at the treasury. An affable former Royal Bank executive, Sousa inherits a $11.9-billion deficit that […]
A suggestion for complicating the simple aggregate production function (bleg)
I wrote this post. Then I realised it was wrong. I really wish my math were better. So I'm turning it into a sort of bleg. I should have written the technology in implicit form as F(C,I,K,L)=0 rather than H(C,I)=F(K,L). Because the way I wrote it makes Pk depend only on I/C, when it should […]
Money and bond bubbles: a parable
I'm using this fable to try to clarify my thoughts. Suppose, just suppose, that Nortel shares had sticky prices. Rather than adjusting almost instantly to ensure market-clearing equilibrium, the price of Nortel shares adjusted slowly over time in response to excess demand or supply of Nortel shares. That would mean that uninformed traders, who knew […]
Canadian Exceptionalism in Compensation
The Parliamentary Budget Office's most recent release "The Fiscal Impact of Federal Personnel Expenses: Trends and Developments" provides some interesting statistics on the amounts of employee compensation paid by Canada’s federal government. According to the report: “in 2011-12, Canada’s federal personnel expenses were $43.8 B, or 2.55 per cent of GDP. These expenses supported a […]
Carney’s Departure: The Bigger Picture
Well, it has been an exciting couple of days in Canada on the policy side given the juxtaposition of the following news: 1) the federal by-election results suggest a more competitive political environment for the federal Conservatives in the stronghold of Alberta 2) the world-class City of Toronto is deposing its Mayor over a conflict […]
Why Harper is Not Going to Halifax
The provincial premiers are meeting on the economy in Halifax today and tomorrow and Prime Minister Harper will not be joining them. Several of them have offered up expressions of surprise and disappointment and have lamented the absence of the Prime Minister. The operatic drama that often characterizes exchanges at federal-provincial meetings has been absent […]
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