Why is Monetary Policy More Effective in the USA Than in Canada?
This paper combines theoretical and empirical analysis to study why monetary policy shocks have stronger effects in the United States than in Canada. Using a modified TANK model with redistributive fiscal policy, the paper shows that the interaction between dividend taxation and the share of Hand-to-Mouth households can amplify or dampen monetary policy transmission. The model is calibrated using U.S. and Canadian data, and its impulse response functions closely match empirical VAR evidence
Pricing Capital Without Interest: Profit–Loss Sharing and Wealth Inequality
This paper develops a theoretical heterogeneous-agent macroeconomic model to study how profit–loss sharing (PLS) contracts affect wealth inequality in an interest-free economy. Using an Aiyagari-style framework with incomplete markets and entrepreneurial risk, the paper shows how differences in entrepreneurial productivity can influence the distribution of wealth and the pricing of capital under PLS finance.