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Technological choices and regulation: the case of the Canadian manufacturing sectors

Author

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  • Pierre Ouellette
  • Stéphane Vigeant

Abstract

The economic environment in which Canadian manufacturing firms operate has changed substantially over the last 40 years. Technological changes, new regulations, deregulation, and exogenous economic shocks all have been important aspects of this economic environment. In this article, we show how to include such changes in the economic environment faced by the firms in a behavioural model that includes the investment decision of the firm under uncertainty. Assumptions regarding the expectation formation process and technology are kept minimal. We estimate the effects of innovations such as the free trade agreement, the foreign investment review agency, and the federal environmental policy on the economic decisions of fifteen Canadian manufacturing sectors.

Suggested Citation

  • Pierre Ouellette & Stéphane Vigeant, 2003. "Technological choices and regulation: the case of the Canadian manufacturing sectors," Canadian Journal of Economics, Canadian Economics Association, vol. 36(1), pages 88-125, February.
  • Handle: RePEc:cje:issued:v:36:y:2003:i:1:p:88-125
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    Cited by:

    1. Danny Leung & Terence Yuen, 2010. "Do exchange rates affect the capital-labour ratio? Panel evidence from Canadian manufacturing industries," Applied Economics, Taylor & Francis Journals, vol. 42(20), pages 2519-2535.
    2. Pierre Ouellette & Stéphane Vigeant, 2001. "Cost and Production Duality: The Case of the Regulated Firm," Journal of Productivity Analysis, Springer, vol. 16(3), pages 203-224, November.

    More about this item

    JEL classification:

    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity

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