In the mid-1970s the Bank of Canada, along with a number of other central banks, began to set explicit targets for monetary growth and to emphasize the long-run role of monetary aggregates in controlling the rapid upward trend of prices. There are three distinct ways of viewing and interpreting...

This paper focuses on the implications of using the monetary base or bank reserves as an instrument to control a monetary aggregate. Following analysis of a series of theoretical models of increasing complexity, it is concluded that in a system with either institutional or structural lags base...

This paper examines the movement of the Canadian dollar over the 1971-76 period. Although Canadian prices increased substantially more than U.S. prices over this period, there was no tendency for a systematic depreciation of the Canadian dollar. To explain this phenomenon requires the...