Search

The article reports on the Divisia aggregation and substitutability among monetary assets in Canada. Monetary asset substitutability is important in understanding the potential effects of monetary policy. Empirical research has found a low degree of substitution among the monetary assets. Also, money and checkable deposits have the lowest partial elasticities of substitution. The utility function is used to test the seperability conditions of monetary aggregates. A statistical index number theory is then used to construct alternative indices.

This paper focuses on the aggregate demand for electricity, natural gas, and light fuel oil in Canada as a whole and six of its provinces-Quebec, Ontario, Manitoba, Saskatchewan, Alberta, and British Columbia-in the residential, commercial, and industrial sectors. We employ the locally flexible normalized quadratic (NQ) expenditure function (in the case of the residential sector) and the NQ cost function (in the case of the commercial and industrial sectors), treat the curvature property as a maintained hypothesis, and provide evidence consistent with neoclassical microeconomic theory. We find that the Morishima interfuel elasticities of substitution are in general positive and statistically significant. Our results indicate limited substitutability between electricity and natural gas, but strong substitutability between light fuel oil and each of electricity and natural gas in most cases. [ABSTRACT FROM AUTHOR]

SUMMARY In this paper we investigate the demand for gasoline in Canada using recent annual expenditure data from the Canadian Survey of Household Spending, over a 13-year period from 1997 to 2009, on three expenditure categories in the transportation sector: gasoline, local transportation, and intercity transportation. In doing so, we use three of the most widely used locally flexible functional forms, the Almost Ideal Demand System (AIDS) of Deaton and Muellbauer (1980), the quadratic AIDS (QUAIDS) of Banks et al. (1997)-an extension of the simple AIDS model that can generate quadratic Engel curves-and the Minflex Laurent model of Barnett (1983), which can also generate quadratic Engel curves. We pay explicit attention to economic regularity, argue that unless regularity is attained by luck, flexible functional forms should always be estimated subject to regularity as suggested by Barnett (2002), and impose local curvature to produce inference consistent with neoclassical microeconomic theory. Our findings indicate that the curvature-constrained Minflex Laurent model is the only model that is able to provide theoretically consistent estimates of the Canadian demand for gasoline. Our estimates show that the own-price elasticity for gasoline demand in Canada is between − 0.738 and − 0.570 -less elastic than previously reported in the literature. Copyright © 2013 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

In this paper we investigate the issue of whether a floating currency is the right exchange rate regime for Canada or whether Canada should consider a currency union with the United States. In the context of the framework recently proposed by James L. Swofford, we use a semi-nonparametric flexible functional form-the asymptotically ideal model (AIM), introduced by William A. Barnett and A. Jonas-and pay explicit attention to the theoretical regularity conditions of neoclassical microeconomic theory, following the suggestions of William A. Barnett and William A. Barnett and Meenakshi Pasupathy. Our results indicate that U.S. dollar deposits are complements to domestic (Canadian) monetary assets, suggesting that Canada should continue the current exchange rate regime, allowing the exchange rate to float freely with no intervention in the foreign exchange market by the Bank of Canada. [ABSTRACT FROM AUTHOR]

We estimate the dynamic Fourier expenditure system to obtain consistent estimates of short-run and long-run Morishima elasticities of substitution for Canadian liquid assets. We argue that the variability of the estimated elasticities and evidence of less than perfect substitution between monetary assets interferes with the successful use of simple-sum aggregates and traditional log-linear money-demand functions. Calibrations semi-non-paramétriques de la substitution pour des actifs monétaires canadiens . Les auteurs calibrent le système dynamique de dépenses à la Fourier pour obtenir des estimations cohérentes des élasticités de substitution à la Morishima à court et à long termes pour des actifs monétaires canadiens. Ils suggèrent que la variabilité des élasticités estimées et la constatation que la substitution n’est pas parfaite entre les actifs monétaires rendent difficile un usage heureux des agrégats de simple somme et des fonctions log-linéaires de demande de monnaie. [ABSTRACT FROM AUTHOR]

Discusses a study which investigated the convergence trends of real per capita government spending in Canadian provinces. Methodology; Empirical findings; Discussion of the results.

Examines the time-series properties of Canadian real output for the years 1870 to 1985. Introduction; Searching for a unit root in output; Treatment of the depression; Conclusion.