EconStor >
Bank of Canada, Ottawa >
Bank of Canada Working Papers >

Please use this identifier to cite or link to this item:

http://hdl.handle.net/10419/53793
  

Full metadata record

DC FieldValueLanguage
dc.contributor.authorLeung, Dannyen_US
dc.contributor.authorSecrieru, Oanaen_US
dc.date.accessioned2011-05-23en_US
dc.date.accessioned2011-12-15T12:55:57Z-
dc.date.available2011-12-15T12:55:57Z-
dc.date.issued2011en_US
dc.identifier.urihttp://hdl.handle.net/10419/53793-
dc.description.abstractThe purpose of this paper is twofold. First, we provide a detailed social accounting matrix (SAM), which incorporates the income and financial flows into the standard input-output matrix, for the Canadian economy for 2004. Second, we use the SAM to assess the strength of the real-financial linkages by calculating and comparing real SAM multipliers and financial social accounting matrix (FSAM) multipliers. For FSAM multipliers, financial flows are endogenous, whereas for real SAM multipliers they are not. Our results show that taking into account financial flows increases the impact of a final demand shock on Canadian output. Financial flows also play an important role in determining the cumulative effect of an income shock or the availability of investment funds. Between 2008 and the first half of 2009, financial institutions shifted their investments towards government bonds, short-term paper, and foreign investments. This shift together with the fact that non-financial institutions were unwilling or unable to increase their financial liabilities, led to estimated declines in all GDP multipliers between 2008 and the first half of 2009 (2009H1). The main advantage of using the extended input-output impact analysis is that it provides a simple framework, with very few assumptions, which allows the assessment of the strength of real-financial linkages by means of multipliers. However, our methodology is subject to the Lucas critique, that as shocks shift prices, agents cannot adjust. Such a framework is, nevertheless, appropriate in short-term impact analysis such as ours.en_US
dc.language.isoengen_US
dc.publisherBank of Canada Ottawaen_US
dc.relation.ispartofseriesBank of Canada Working Paper 2011,14en_US
dc.subject.jelC67en_US
dc.subject.jelD57en_US
dc.subject.ddc330en_US
dc.subject.keywordEconomic modelsen_US
dc.subject.keywordFinancial marketsen_US
dc.subject.keywordSectoral balance sheeten_US
dc.subject.stwSocial Accounting Matrixen_US
dc.subject.stwInput-Outputen_US
dc.subject.stwFinanzmarktkriseen_US
dc.subject.stwInterindustrielle Verflechtungen_US
dc.subject.stwTheorieen_US
dc.subject.stwKanadaen_US
dc.titleReal-financial linkages in the Canadian economy: An input-output approachen_US
dc.typeWorking Paperen_US
dc.identifier.ppn659462699en_US
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungenen_US
Appears in Collections:Bank of Canada Working Papers

Files in This Item:
File Description SizeFormat
659462699.pdf208.56 kBAdobe PDF
No. of Downloads: Counter Stats
Show simple item record
Download bibliographical data as: BibTeX

Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.