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Three Policies to Improve Productivity Growth in Canada

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Author Info
Andrew Sharpe ()
Abstract

This paper makes the case that productivity is Canada’s economic destiny and that Canada’s dismal productivity performance, both from a historical and international perspective, therefore represents our biggest economic challenge. It then puts forward three specific policies to improve Canada’s productivity performance: foster the diffusion of best-practice technologies; remove the provincial sales tax on purchases of machinery and equipment; and promote interprovincial movement of workers by improving labour market information, removing professional barriers to labour mobility, and establishing a tax credit for interprovincial job search. It finds that the short-term costs of these policies would be greatly outweighed by the long-term benefits associated with their implementation.

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Paper provided by Centre for the Study of Living Standards in its series CSLS Research Reports with number 2007-05.

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Date of creation: Dec 2007
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Handle: RePEc:sls:resrep:0705

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Related research
Keywords: Productivity growth in Canada; Policy; Diffusion; Provincial sales tax; Interprovincial migration.;

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Find related papers by JEL classification:
O20 - Economic Development, Technological Change, and Growth - - Development Planning and Policy - - - General
O33 - Economic Development, Technological Change, and Growth - - Technological Change - - - Technological Change: Choices and Consequences; Diffusion Processes
O38 - Economic Development, Technological Change, and Growth - - Technological Change - - - Government Policy
O47 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Measurement of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence

This paper has been announced in the following NEP Reports:

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Finnie, Ross, 2001. "The Effects of Inter-provincial Mobility on Individuals' Earnings: Panel Model Estimates for Canada," Analytical Studies Branch Research Paper Series 2001163e, Statistics Canada, Analytical Studies Branch. [Downloadable!]
  2. Baldwin, John R. & Maynard, Jean-Pierre & Tanguay, Marc & Wong, Fanny & Yan, Beiling, 2005. "A Comparison of Canadian and U.S. Productivity Levels: An Exploration of Measurement Issues," Economic Analysis (EA) Research Paper Series 2005028e, Statistics Canada, Analytical Studies Branch. [Downloadable!]
  3. Andrew Sharpe, 2004. "Ten Productivity Puzzles Facing Researchers," International Productivity Monitor, Centre for the Study of Living Standards, vol. 9, pages 15-24, Fall. [Downloadable!]
  4. Someshwar Rao & Jianmin Tang & Weimin Wang, 2003. "Canada's Recent Productivity Record and Capital Accumulation," International Productivity Monitor, Centre for the Study of Living Standards, vol. 7, pages 24-38, Fall. [Downloadable!]
  5. Michael Smart, 2006. "The GST Cut and Fiscal Imbalance," International Tax Program Papers 0604, International Tax Program, Institute for International Business, Joseph L. Rotman School of Management, University of Toronto. [Downloadable!]
  6. Jean-Philippe Cotis, 2006. "Benchmarking Canada's Economic Performance," International Productivity Monitor, Centre for the Study of Living Standards, vol. 13, pages 3-20, Fall. [Downloadable!]
  7. Aled ab Iorwerth & Jeff Danforth, . "Is Investment Not Sensitive to its User Cost? The Macro Evidence Revisited," Working Papers-Department of Finance Canada 2004-05, Department of Finance Canada. [Downloadable!]
  8. Alberto Isgut & Lance Bialas & James Milway, 2006. "Explaining Canada-U.S. Differences in Annual Hours Worked," International Productivity Monitor, Centre for the Study of Living Standards, vol. 13, pages 27-45, Fall. [Downloadable!]
  9. Don Drummond, 2006. "The Economists' Manifesto for Curing Ailing Canadian Productivity," International Productivity Monitor, Centre for the Study of Living Standards, vol. 13, pages 21-26, Fall. [Downloadable!]
  10. Andrew Sharpe, 2006. "Future Productivity Growth in Canada and Implications for the Canada Pension Plan," CSLS Research Reports 2006-01, Centre for the Study of Living Standards. [Downloadable!]
  11. Grady, Patrick & Macmillan, Kathleen, 2007. "Interprovincial Barriers to Labour Mobility in Canada:Policy, Knowledge Gaps and Research Issues," MPRA Paper 2988, University Library of Munich, Germany. [Downloadable!]
  12. Maximilian Baylor & Louis Beauséjour, . "Taxation and Economic Efficiency: Results from a Canadian CGE Model," Working Papers-Department of Finance Canada 2004-10, Department of Finance Canada. [Downloadable!]
  13. Osberg, Lars & Sharpe, Andrew, 2002. "An Index of Economic Well-Being for Selected OECD Countries," Review of Income and Wealth, Blackwell Publishing, vol. 48(3), pages 291-316, September. [Downloadable!] (restricted)
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