The authors document a robust and interesting relationship between the real domestic price of oil and real effective exchange rates for Germany, Japan and the United States. They explain why they think the real oil price captures exogenous terms-of-trade shocks and why such shocks could be the...

In this paper the author examines whether there is significant evidence of the effect of adjustment costs on Canadian labour demand. This is an important question, as sluggish adjustment of labour demand resulting from significant adjustment costs may be one factor that could help explain some...

There is a substantial empirical literature which examines the relationship between private and public consumption. The conclusions from this literature, however, are generally mixed. In this paper, we attempt to provide some additional evidence on this relationship. We consider a two-good...

Authors' note: Subsequent to completing this Working Paper, we realized that the way we constructed the weighted relative prices, ri, as described on page 8, is not invariant to the rate of inflation and this introduces a bias in favour of the menu-cost hypothesis. Preliminary results with a...

In this paper, we study intraperiod and intertemporal substitution in U.S. import demand using a two-good version of the permanent-income model that allows for nonseparability between domestic and imported goods consumption. The intratemporal elasticity of substitution between the two goods is...

We examine the ability of the simple linear-quadratic model under rational expectations to explain dynamic behaviour of aggregate Canadian imports. In contrast to authors of previous studies who examine dynamic behaviour using the LQ model, we estimate the structural parameters using the Euler...

Research aimed at explaining the greater persistence of unemployment in European countries relative to the US has found higher employment adjustment costs in Europe to be a significant contributing factor. This paper explores the potential for costly adjustment of labour to explain at least some...

In this paper, we examine the idea that a general model of consumption should allow for the direct effect of government expenditures in a two-good permanent-income model. We show, given an assumed preference specification, that there is a cointegration restriction implied by an intraperiod...