I Canada’s Poor Productivity Performance
Canada is unique, since the quality of life for Canadians is phenomenal, yet, our productivity growth is quite poor in comparison to other first world countries (Alini, 2013, para. 1). Productivity growth is important, since it increases our purchasing power, and the quality of life of its citizens (Alini, 2013, para. 1). Prior to the 1980’s, Canada faced high inflation, growing public debt, internal and external trade restrictions, and high rates of taxation (Alini, 2013, para. 4). However, many benefits were awarded with the North American Free Trade Agreement (NAFTA), inflation-reducing budget cuts from the Bank of Canada, and a reduction in corporate taxation, and yet to no avail (Alini, 2013, para.
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Stephen Harper believes providing investment incentives for manufacturing businesses, improving free trade, and providing government funding to privatize and incentivize R&D will increase Canada’s productivity growth (Alini, 2013, para. 18). Furthermore, the federal government needs to create a demand and for Canada’s products and resources. In addition, government funding needs to go towards educating Canadian citizens on the aspects of industry that will contribute to an increase in productivity. NAFTA is beneficial to Canada, but there are many other countries that are willing to have trade agreements as well. Lastly, the federal government needs to revamp taxation to all corporations to encourage corporate expansion, new foreign investments, and to attract new businesses and new corporate …show more content…
1). Yet, as a whole, commercial innovation lacks incentive in Canada (McFetridge, 2008, p. 2). Initially, in the mid 2000’s, there were several issues that are liable for the decrease in productivity. For example, the acute respiratory syndrome crisis, the outbreak of mad cow disease impacting Canadian beef, the Ontario power blackout, and the drastic increase in the value of the Canadian dollar (McFetridge, 2008, p. 4). Analyzing the historical causes for Canada’s low productivity growth will allow the country to address and learn from their impediments to innovation. Between the periods of 1996 to 2006, the change in the exchange rate affected industry labor and capital costs, and the reduction in the trade value of Canadian resources impacted primary industries, which are viable causes of low productivity (McFetridge, 2008, p.
The global economy has been recovering from the financial crisis which occurs in 2008, then has a weak growth for most developed countries over 2012 and 2013. But economic activity in Canada has expanded at a faster pace than most other major advanced countries in 2012; however, economic performance in Canada has been unsteady throughout 2013 (The Economic review, 2013). After the last quarter in 2010 GDP growth rate grows rapidly, the GDP grows slowly but steadily in 2012 which remains at around 3 percent. Real GDP growth rate in Canada grows slowly in the first quarter of 2013, but increased by 5 percent in the second quarter ,then remains the same level until the first quarter of 2014 (Statistics Canada, 2014). In 2014, the Canadian government take a series economic action plan as a guide for the economy development such as improving investment conditions, ...
Canada’s ability to maintain a healthy income is important, for without it, Canada’s economy would not be functional. This is where Canada’s three main exports come into play. In 2013, Canada earned 133 billion dollars in exporting Mineral products, 123 billion dollars of that coming from mineral fuels, oils, products of their distillation, bituminous substances, and mineral waxes (Ibid.). With such a booming mineral industry, Canada receives a large income from mining that can be invested in schools, jobs, public projects, and many other important areas . Also, the earnings can be devoted towards small businesses looking to expand by using government funding programs, which helps support and expand Canadian economy (Mentor Works). Overall the money is used for activities that support the Canadian economy and make numerous people’s lives better.
Spicer, Keith. 1991. Citizen’s Forum on Canada’s Future: Report to the People and Government of
...munity. Although Canada is dependent on trade with the United States, NAFTA proves that the relationship goes both ways. Canada proved its worth in the global financial crisis, showing that it can practice good policy despite the dependence.
...nguage, and religion all make up Canada’s human face, but also front how the cultural accommodation will continue with the risk of losing Canada’s main traditions. Faultlines again come into perspective within demographic issues, especially with newcomers/old-timers, aboriginal population expansions, and French/English language. The core/periphery model is also represented. The end of the chapter places a focus on Canada’s economic face as well, dealing with stresses inside the global economy as well as its strong dependency on the U.S markets (Bone, 169) especially with the stimulating global recession. Canada’s economic structure leans on the relative share of activity in the primary (natural resource extraction), secondary (raw material assembly), tertiary (sale/exchange of goods and services), and quaternary (decision-making) sectors of the economy (Bone, 166).
The goal of NAFTA was to systematically eliminate most tariff and non-tariff barriers to trade and investment between the countries. NAFTA has allowed U.S., Mexico, and Canada to import and export to other at a lower cost, which has increased the profit of goods and services annually. Because the increase in the trade marketplace, NAFTA reduces inflation, creates agreements on intern...
People outside of Canada are baffled at how Canada ended up in such a state of affairs. Canada as a country has a lot going for it. A high GNP, and high per capita income in international terms. It is ranked at the top of the...
Newman, Garfield et al. Canada A Nation Unfolding. Toronto: Mc Graw – Hill Ryerson Limited, 2000.
The baby boom generation’s first memorable contribution to Canada was to raise the Canadian economy to a higher stage with the emergence of greater number of people with varying abilities. With the sudden increase in the population, more demands for more products and services were undoubtedly created, helping the economy to strive forward and advance Canada to be competitive in the global market. Before the baby boom period, Canada was suffering from the aftermath of the Great Depression. There was a lack of jobs and people did not have the sufficient funds to spend on any extra luxuries and this created a vicious cycle of economic crisis. However, due to thou...
...be tempered by their desire to be a wealthy nation as well. Becoming a wealthy nation means becoming economically dependant on the US. Foreign ownership is on the rise in Canada, our vast natural resources up for grabs by the energy hungry US and there are less and less restrictions every day for trade within North America. NAFTA has created a good environment for Canada thrive, exports are increasing and we are exporting a safe amount, as not to deplete or decimate any one of our natural resources. Canada is in a good position. We have a small population, great resources and neighbours who have an insatiable need for our goods. Unfortunately this may mean giving up some of our Canadian identity, as if that hasn’t already happened. Yes, our import and exports are mainly to one country, the US, but why not be dependant on the most powerful nation on the planet, ever.
Canada and the United States are the largest trade partners in the world. It is the result of the geographical position of two countries and the free trade between two countries. It should be a great thing for the economies of both countries, but since the North American Free Trade Agreement was signed, American businesses almost took over the Canadian economy. When the American companies started to make more business in Canada, it brought more jobs and money to the country in the short-term. But as a long-term effect Canadians became even more depended on the U.S. as the American companies started dominating Canadian companies in Canada. Also, today Canadian manufacturers have little protection from the government when ch...
Labour productivity growth plays a crucial role in driving economic growth in Canada. It is the single most important determinant of a country's per capita income in the long run. Labour productivity growth is influenced by a broad range of factors, such as trade liberalization, commodity prices, and capital to labour mix. Despite successive government interventions intended to improve Canada's labour productivity growth, it remains sluggish compared to the United States. A large Canada-U.S. gap has developed in multifactor productivity (MFP) - a component of productivity growth that is unrelated to increased capital intensity and skills upgrading and is often interpreted as innovation.
Determinants of Productivity Determinants of Productivity Productivity is the quantity of output formed by one unit of production input in a unit of time. Inputs used in the production of the goods and services are the major determinants of any country’s productivity; they are also called factors of production. There are four major determinants of productivity in any country’s economy. Land: the land itself, and raw materials such as oil and minerals beneath it. The natural resources that are available without alteration or effort on the part of humans.
known for decades: it pays to invest in Canada. There is a government commitment to attract foreign direct investment. Canada's government provides a competitive, welcoming climate for international business. It is committed to fiscal responsibility, deficit reduction and job creation.
The shortage of skilled workers in the coming decade poses a serious threat to all aspects of the Canadian economy. Like all others, our economy is comprised of three major elements: primary products, secondary goods and services. My research indicates that primary products constitute just over 7% of Canada's GDP, secondary goods account for 21%, and the services comprise 72%. This distribution although heavily in favor of the service industry still shows the importance of the secondary/manufacturing industry in Canada's modern day economy. Taking into fact that since the late nineteenth century, Canada's centre of manufacturing is focused in two provinces, Ontario and Quebec. Consistently, year after year, Ontario contributes about 50% of the Canadian total of manufactured goods produced, measured by value, and Quebec 25%.