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Long-term Fiscal and Economic Projections for Canada and the Provinces and Territories, 2014-2038

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  • Don Drummond
  • Evan Capeluck

Abstract

This report presents long-term fiscal and economic projections for Canada, the provinces and the territories for the 2014-2038 period, and discusses their implications for budgetary balance at the provincial/territorial level. In particular, it examines whether economic growth and hence revenue growth (assuming no major changes in tax policy) will be sufficient to fund likely spending pressures. Economic growth is generally projected to be slower over the next 24 years than since 2000. As a result, all, or almost all, provinces and territories, depending upon the economic assumptions, will not be able to meet the test of balancing revenue growth with growth in public spending. Hence, without tax rate increases or action to curtail spending growth, there will be pressure for progressively larger deficits.

Suggested Citation

  • Don Drummond & Evan Capeluck, 2015. "Long-term Fiscal and Economic Projections for Canada and the Provinces and Territories, 2014-2038," CSLS Research Reports 2015-08, Centre for the Study of Living Standards.
    • Handle: RePEc:sls:resrep:1508
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    File URL: http://www.csls.ca/reports/csls2015-08.pdf
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    References listed on IDEAS

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    1. Jeremy Smith, 2004. "Assessing Aggregate Labour Productivity Trends in Canada and the United States: Total Economy versus Business Sector Perspectives," International Productivity Monitor, Centre for the Study of Living Standards, vol. 8, pages 47-58, Spring.
    2. Nicholas-James Clavet & Jean-Yves Duclos & Bernard Fortin & Steeve Marchand & Pierre-Carl Michaud, 2013. "Les dépenses en santé du gouvernement du Québec, 2013-2030 : projections et déterminants," CIRANO Working Papers 2013s-45, CIRANO.
    3. David A. Dodge & Richard Dion, 2011. "Chronic Healthcare Spending Disease: A Macro Diagnosis and Prognosis," C.D. Howe Institute Commentary, C.D. Howe Institute, issue 327, April.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Andrew Sharpe, 2016. "Productivity to the Rescue: Review Article on the McKinsey Global Institute Report Global Growth: Can Productivity Save the Day in an Aging World?," International Productivity Monitor, Centre for the Study of Living Standards, vol. 30, pages 98-110, Spring.
    2. Steve Ambler & Craig Alexander, 2015. "One Percent? For Real? Insights from Modern Growth Theory about Future Investment Returns," e-briefs 216, C.D. Howe Institute.
    3. Don Drummond, 2021. "ViewPoint: Canada Should Establish an Equitable Growth Institute," International Productivity Monitor, Centre for the Study of Living Standards, vol. 40, pages 105-117, Spring.
    4. Abrar Arif, 2022. "Economic Projections for Canada and the Provinces, 2019-2038," CSLS Research Reports 2022-01, Centre for the Study of Living Standards.
    5. Mike Pennock, 2016. "Slower Economic Growth and Subjective Well-Being in the Canadian Context: A Discussion Paper," CSLS Research Reports 2016-09, Centre for the Study of Living Standards.
    6. Don Drummond & Evan Capeluck & Matthew Calver, 2015. "The Key Challenge for Canadian Public Policy: Generating Inclusive and Sustainable Economic Growth," CSLS Research Reports 2015-11, Centre for the Study of Living Standards.
    7. Andrew Agopsowicz & Dany Brouillette & Shutao Cao & Natalia Kyui & Pierre St-Amant, 2016. "April 2016 Annual Reassessment of Potential Output in Canada," Staff Analytical Notes 16-4, Bank of Canada.
    8. Don Drummond & Evan Capeluck, 2015. "The Role of Productivity in Long-Term Economic and Fiscal Projections for the Canadian Provinces and Territories, 2014-2038," International Productivity Monitor, Centre for the Study of Living Standards, vol. 29, pages 3-17, Fall.

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    More about this item

    Keywords

    Projection; Ageing; Fiscal Sustainability; Demographics; Canada; Budget; Provinces; Revenue Growth; Taxes; Economic Growth;
    All these keywords.

    JEL classification:

    • E17 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Forecasting and Simulation: Models and Applications
    • E27 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Forecasting and Simulation: Models and Applications
    • E37 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Forecasting and Simulation: Models and Applications
    • E47 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Forecasting and Simulation: Models and Applications
    • E60 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - General
    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory
    • E66 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - General Outlook and Conditions
    • H20 - Public Economics - - Taxation, Subsidies, and Revenue - - - General
    • H50 - Public Economics - - National Government Expenditures and Related Policies - - - General
    • H51 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Health
    • H60 - Public Economics - - National Budget, Deficit, and Debt - - - General
    • H61 - Public Economics - - National Budget, Deficit, and Debt - - - Budget; Budget Systems
    • H62 - Public Economics - - National Budget, Deficit, and Debt - - - Deficit; Surplus
    • H68 - Public Economics - - National Budget, Deficit, and Debt - - - Forecasts of Budgets, Deficits, and Debt
    • H70 - Public Economics - - State and Local Government; Intergovernmental Relations - - - General
    • H71 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Taxation, Subsidies, and Revenue
    • H72 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Budget and Expenditures
    • J10 - Labor and Demographic Economics - - Demographic Economics - - - General
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General

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