An alternative estimate of Canadian potential output : the multivariate state-space framework / by Lise Pichette, Maria Bernier and Marie-Noëlle Robitaille.: FB3-6/2018-14E-PDF

"In this paper, we extend the state-space methodology proposed by Blagrave et al. (2015) and decompose Canadian potential output into trend labour productivity and trend labour input. As in Blagrave et al. (2015), we include output growth and inflation expectations from consensus forecasts to help refine our estimates. Our alternative model, which we call the multivariate state-space framework (MSSF), adds to the Bank’s existing set of tools for estimating potential output and the output gap in Canada. We find that while the MSSF shares similar dynamics to the main approaches used by the Bank, it also indicates that the economy experienced greater excess supply in both the 1990 and 2008 recessions than the Bank’s other tools would suggest. Finally, the MSSF estimates that the Canadian economy has been operating close to capacity since the end of 2017"--Abstract, p. iv.

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Publication information
Department/Agency Bank of Canada.
Title An alternative estimate of Canadian potential output : the multivariate state-space framework / by Lise Pichette, Maria Bernier and Marie-Noëlle Robitaille.
Variant title Multivariate state-space framework
Series title Bank of Canada staff discussion paper, 1914-0568 ; 2018-14
Publication type Series - View Master Record
Language [English]
Format Electronic
Electronic document
Note(s) "November 2018."
Includes bibliographic references.
Includes abstract in French.
Publishing information [Ottawa] : Bank of Canada, 2018.
Author / Contributor Pichette, Lise.
Bernier, Maria.
Robitaille, Marie-Noëlle.
Description iv, [13] p. : col. charts.
Catalogue number
  • FB3-6/2018-14E-PDF
Subject terms Productivity
Inflation
Potential output
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