• A sharp rise in real commodity prices has boosted Canada’s terms of trade and exchange rate over the past five years. These relative price movements, underpinned by a strong global demand for commodities, have generated substantial real income gains, reduced Canadian cost competitiveness, and changed relative factor prices in favour of capital, thereby stimulating final domestic demand, depre...

Loan commitments represent more than 82 percent of all commercial and industrial loans by domestic banks. This paper develops a valuation model for loan commitments incorporating early exercise, multiple fees, partial exercise and credit risk. The model is analytically tractable and easy to implement. Using a sample of commercial paper backup credit lines from the Dealscan database, we show tha...

The objective of this study is to measure the effect of global policy reforms on rice trade, prices, and economic welfare. The Doha Round of multilateral trade negotiations aims to increase market access, and reduce or eliminate export subsidies and trade distorting domestic price supports. Two modeling frameworks are used to estimate trade, price and economic welfare effects of policy reforms....

The present paper analyzes propagation of shocks to food and energy prices in 46 countries with data from the period 1999-2010. The empirical evidence suggests that in only one of the countries considered, a shock to the price of either energy or food shows no propagation to the prices of the goods and services included in the core inflation measure. In general, the propagation effect of food p...

This paper elucidates the impacts of the September 2005 foot and mouth disease outbreak on the Brazilian meat market for different levels of the industry (export, wholesale, and farm). The associated import ban by Russia on Brazilian meat exports is also analyzed. Results suggest that the increase in domestic supply due to the import ban generated downward pressure on prices at all levels for p...

This study investigates the potential impacts of food safety outbreaks on domestic shipments, imports, and prices of the produce industry. Three case studies were analyzed to assess these potential impacts: the cantaloupe outbreak of March–April 2008, the spinach outbreak of September 2006, and the tomato outbreak of June–July 2008. Data-determined historical decompositions were conducted to pr...

4 Non-technical summary 5 7 2 10 2.1 Sectors and aggregation 10 2.2 Relative prices 11 2.3 Real exchange rate and sectoral productivity shocks 12 2.4 Nominal rigidity and aggregate supply 14 3 Autonomous monetary policy 15 4 The currency union 17 4.1 Determination of union-wide output and prices 18 4.2 Currency union’s welfare 19 4.3 Reference member state’s welfare 20 5 Relative performance an...

Reference price systems for prescription drugs constitute widely adopted cost containment tools. Under these regimes, patients co-pay a fraction of the difference between a drug's pharmacy retail price and a reference price that is set by the government. Reference prices are either externally (based on drug prices in other countries) or internally (based on domestic drug prices) determined. We ...