Constraints on the Conduct of Canadian Monetary Policy in the 1990s: Dealing with Uncertainty in Financial Markets
Bibliographic record
Abstract
Canada's economic performance in the first half of the 1990s was adversely affected by high premiums in interest rates that were brought on by political and economic uncertainties. The short-term output-inflation trade-off was worsened since these uncertainties weakened the value of the Canadian dollar at the same time as they raised domestic interest rates. In this environment, attempts by the Bank of Canada to ease monetary conditions were liable to be misinterpreted by the market as a sign of weakening commitment to inflation control. On several occasions, such fears led to sharp increases in interest rates. The first part of this report presents a simple theoretical model that shows the qualitative impact of the increased interest rate premiums on economic performance. Some evidence is presented that suggests high Canadian interest rate premiums were an important factor explaining the general weakness of economic activity. This is followed by a discussion of the tactical conduct of monetary policy when the need to build credibility often seemed to be in conflict with the desired easing of monetary conditions. Finally, the report describes steps that the Bank has taken to reduce uncertainty about how it conducts monetary policy.
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How this classification was reachedexpand
Full frame machine prediction
Teacher imitationNot calibrated prevalence, not ground truth. Human validation pending. The Gemma side is a direct model label for every work in the frame, read from the title-only record. The Codex side is a classifier learned from the 10,348 direct Codex labels and calibrated to design-weighted sample rates; fields without enough sample support carry no Codex call. Candidate is the union of the two sides; consensus is their intersection. These outputs are machine_predicted_unvalidated and are not human labels.
Distilled classifier scores by category (both heads)
| Category | Codex | Gemma |
|---|---|---|
| Metaresearch | 0.005 | 0.015 |
| Meta-epidemiology (narrow) | 0.001 | 0.000 |
| Meta-epidemiology (broad) | 0.001 | 0.001 |
| Bibliometrics | 0.002 | 0.004 |
| Science and technology studies | 0.007 | 0.004 |
| Scholarly communication | 0.011 | 0.002 |
| Open science | 0.001 | 0.002 |
| Research integrity | 0.003 | 0.003 |
| Insufficient payload (model declined to judge) | 0.004 | 0.000 |
Machine scores (provisional)
The two teacher heads of the student model, read on this work. A score orders the frame for review; it never asserts a category, and the validation status ships verbatim with every row.
Baseline scores from an immature model (maturity gate not passed, 7 training rounds). Scores rank; they never assert a category.
score_only:v0-immature-baseline · verbatim from the scoring run: score_only means the number may rank works, and no category label ships from itClassification
machine, unvalidatedMachine predicted; a candidate call from one source (direct Gemma or distilled Codex), not a consensus.
How this classification was reached, model by model and score by score, is at the end of the page under "How this classification was reached".