Energy Prices and Real Economic Activity in Canada: A Multi-Sector Dynamic General Equilibrium Analysis

Yazid Dissou

No 0707E, Working Papers from University of Ottawa, Department of Economics

Abstract: As a net exporter of oil, the recent upward trend in the world prices of energy products represents both an opportunity and a challenge for Canada. This study investigates the aggregate and sectoral effects of a sustained increase in these prices on the Canadian economy using a multi-sector forward-looking dynamic general equilibrium model. Counterfactual simulation results suggest that these price shocks would be beneficial to the Canadian economy on an aggregate basis, as real GDP would increase during most periods and households would increase their consumption profile during all periods and would thereby improve their well being. Nevertheless, the price increases would also shift resources toward export booming sectors and would lead to an appreciation of the real exchange rate that would not be beneficial to traditional manufacturing export industries.

Keywords: Energy prices; commodity prices; aggregate and sectoral impacts; dynamic general equilibrium modeling; Canada (search for similar items in EconPapers)
JEL-codes: C68 E30 F14 N72 Q33 Q43 (search for similar items in EconPapers)
Pages: 29 pages
Date: 2007
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://sciencessociales.uottawa.ca/economics/sites ... mics/files/0707E.pdf (application/pdf)
Our link check indicates that this URL is bad, the error code is: 504 Gateway Time-out (http://sciencessociales.uottawa.ca/economics/sites/socialsciences.uottawa.ca.economics/files/0707E.pdf [301 Moved Permanently]--> https://sciencessociales.uottawa.ca/economics/sites/socialsciences.uottawa.ca.economics/files/0707E.pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ott:wpaper:0707e

Access Statistics for this paper

More papers in Working Papers from University of Ottawa, Department of Economics Contact information at EDIRC.
Bibliographic data for series maintained by Aggey Semenov ().