We assess the potential financial risks of current and projected flooding caused by extreme weather events in Canada. We focus on the residential real estate secured lending (RESL) portfolios of Canadian financial institutions (FIs) because RESL portfolios are an important component of FIs'...

This paper examines how border carbon adjustments (BCAs) may address the unintended consequences of uncoordinated global climate action, focusing on the economic implications for Canada. We investigate these implications under different BCA design features and by considering a coalition of...

This paper proposes a forward-looking metric of transition risk that relates financial performance and incremental carbon costs at the firm level. To this end, we use a consistent dividend discount framework augmented with emission costs of firms and climate scenario projections from four...

Central banks are increasingly focused on the risks from climate change for the economy and financial system. Two sets of risks are of particular concern: physical risks from more frequent and severe weather events, and transition risks from the move toward a lower-carbon intensive economy. This...

In November 2020, the Bank of Canada launched a pilot project with the Office of the Superintendent of Financial Institutions aimed at better understanding risks to the economy and the financial system related to climate change. Part of this work included developing a set of Canada-relevant...

We consider the effects of protectionist trade policies on international and domestic market integration, using evidence from the long-standing softwood lumber trade dispute between Canada and the United States. The benefits of trade liberalization are widely acknowledged, including better...