Exchange rate fluctuations and labour market adjustments in Canadian manufacturing industries

Arbeitspapier

We estimate the link between exchange rate fluctuations and the labour input of Canadian manufacturing industries. The analysis is based on a dynamic model of labour demand, and the econometric strategy employs a panel two-step approach for cointegrating regressions. Our data are drawn from a panel of 20 manufacturing industries from the KLEMS database and cover a long sample period that includes two full cycles of appreciation and depreciation of the Canadian dollar. Our results indicate that exchange rate fluctuations have significant long-term effects on the labour input of Canada's manufacturing industries, that these effects are stronger for trade-oriented industries, and that these long-term impacts materialize only gradually following shocks.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Bank of Canada Staff Working Paper ; No. 2015-45

Classification and Topics

• Classification: Wirtschaft ; Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity ; Empirical Studies of Trade ; Trade and Labor Market Interactions ; Foreign Exchange ; Open Economy Macroeconomics ; Labor Demand
• Subject: Exchange rates ; Exchange rate regimes ; Econometric and statistical methods ; Labour markets ; Recent economic and financial developments

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Bruneau, Gabriel ; Moran, Kevin
• Event: Veröffentlichung
• (who): Bank of Canada
• (where): Ottawa
• (when): 2015

Further information

• DOI: doi:10.34989/swp-2015-45
• Handle: http://hdl.handle.net/10419/141988
• Last update: 10.03.2025, 11:42 AM CET