Why Was Canada Exempt from the Financial Crisis?

Econ Focus Fourth Quarter 2013 Canada has avoided crises for 180 years, while we have been prone to them. Can we recreate its stability here? As the worst financial crisis in generations hit the United States in 2007 and 2008, Canada was a pillar of resilience. No Canadian financial institutions failed. There were no government bailouts of insolvent firms (just a couple of lending programs to address market volatility relating to problems in the United States). Canada was the only G-7 country to avoid a financial crisis, and its recession was milder than those it experienced in the 1980s...

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Columbia | SIPA April 28, 2014 In Fragile by Design: The Political Origins of Banking Crises and Scarce Credit, Charles W. Calomiris of SIPA and Columbia Business School and Stephen H. Haber of Stanford University examine the historical record in the United Kingdom, the United States, Canada, Mexico, and Brazil to show how banking has played out over time in different nations and, even more important, in different political contexts. Calomiris and Haber find that banking crises and lack of credit are not accidents, but the product of national political frameworks that reflect the input of multiple stakeholders. They suggest that the well-being of banking systems depends on the abilities of political institutions to balance and limit how coalitions of these various groups influence government regulations. Professor Calomiris, who is on leave this year to advise the IMF on banking policy, spoke with SIPA News about the book. » See the full article in SIPA...

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