Major Papers


Real-business-cycle model, Solar activity, Consumption, Investment


This papers uses a three-sector Real Business Cycle model with a stochastic sunspot volatility shock to estimate the adverse effects of intense solar activity to the economy of Canada. To the best of my knowledge this is the first study to measure the adverse effects of intense solar activity in Canada. Calibrating the model for Canada's economy, I found that a solar activity shock leads to lower output, consumption, and investment. These findings are confirmed from an econometric exercise using Canadian data. Precisely, this paper finds that every percentage point increase in solar activity generates a 0.26 percentage point decrease in real GDP per capita.

Primary Advisor

Michael, Batu

Program Reader

Marcelo, Arbex

Degree Name

Master of Arts



Document Type

Major Research Paper

Convocation Year


Included in

Economics Commons