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Canada's Productivity Performance in International Perspective

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  • Dirk Pilat

Abstract

Considering the entire 1995-2003 period and compared to all OECD countries, this paper presents the view that Canada has actually performed quite well in terms of labour productivity growth. The author points to two factors that have fostered productivity growth in Canada: a high level of human capital and low barriers to firm creation. The latter facilitates creative destruction by allowing new firms to challenge existing firms and force less productive firms out of the market. Canada also appears to have benefited from innovation driven by ICT use and related organizational change, especially in the service sector. One weakness highlighted is innovative capacity, as Canada generally lags most other countries in terms of R&D intensity and patents.

Suggested Citation

  • Dirk Pilat, 2005. "Canada's Productivity Performance in International Perspective," International Productivity Monitor, Centre for the Study of Living Standards, vol. 10, pages 24-44, Spring.
    • Handle: RePEc:sls:ipmsls:v:10:y:2005:2
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    References listed on IDEAS

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    1. Paul Conway & Véronique Janod & Giuseppe Nicoletti, 2005. "Product Market Regulation in OECD Countries: 1998 to 2003," OECD Economics Department Working Papers 419, OECD Publishing.
    2. Dirk Pilat & Paul Schreyer, 2004. "The OECD Productivity Database: An Overview," International Productivity Monitor, Centre for the Study of Living Standards, vol. 8, pages 59-65, Spring.
    3. Dale W. Jorgenson, 2007. "Information Technology and the G7 Economies," NBER Chapters, in: Hard-to-Measure Goods and Services: Essays in Honor of Zvi Griliches, pages 325-350, National Bureau of Economic Research, Inc.
    4. Andrea Bassanini & Stefano Scarpetta, 2001. "Does Human Capital Matter for Growth in OECD Countries?: Evidence from Pooled Mean-Group Estimates," OECD Economics Department Working Papers 282, OECD Publishing.
    5. Bassanini, Andrea & Scarpetta, Stefano, 2002. "Does human capital matter for growth in OECD countries? A pooled mean-group approach," Economics Letters, Elsevier, vol. 74(3), pages 399-405, February.
    6. Nadim Ahmad & François Lequiller & Pascal Marianna & Dirk Pilat & Paul Schreyer & Anita Wölfl, 2003. "Comparing Labour Productivity Growth in the OECD Area: The Role of Measurement," OECD Science, Technology and Industry Working Papers 2003/14, OECD Publishing.
    7. Dominique Guellec & Bruno van Pottelsberghe de la Potterie, 2003. "R&D and Productivity Growth: Panel Data Analysis of 16 OECD Countries," OECD Economic Studies, OECD Publishing, vol. 2001(2), pages 103-126.
    8. Baldwin, John R. Gu, Wulong, 2004. "Industrial Competition, Shifts in Market Share and Productivity Growth," Economic Analysis (EA) Research Paper Series 2004021e, Statistics Canada, Analytical Studies Branch.
    9. Danny Leung, 2004. "The Effect of Adjustment Costs and Organizational Change on Productivity in Canada: Evidence from Aggregate Data," International Productivity Monitor, Centre for the Study of Living Standards, vol. 9, pages 52-61, Fall.
    10. Haltiwanger, John & Jarmin, Ron & Schank, Thorsten, 2003. "Productivity, investment in ICT and market experimentation: micro evidence from Germany und the US," Discussion Papers 19, Friedrich-Alexander University Erlangen-Nuremberg, Chair of Labour and Regional Economics.
    11. Gust, Christopher & Marquez, Jaime, 2004. "International comparisons of productivity growth: the role of information technology and regulatory practices," Labour Economics, Elsevier, vol. 11(1), pages 33-58, February.
    12. Alain de Serres, 2003. "Structural Policies and Growth: A Non-Technical Overview," OECD Economics Department Working Papers 355, OECD Publishing.
    13. Paul Schreyer & Pierre-Emmanuel Bignon & Julien Dupont, 2003. "OECD Capital Services Estimates: Methodology and a First Set of Results," OECD Statistics Working Papers 2003/6, OECD Publishing.
    14. Nadim Ahmad, 2003. "Measuring Investment in Software," OECD Science, Technology and Industry Working Papers 2003/6, OECD Publishing.
    15. Jerry Sheehan & Andrew Wyckoff, 2003. "Targeting R&D: Economic and Policy Implications of Increasing R&D Spending," OECD Science, Technology and Industry Working Papers 2003/8, OECD Publishing.
    16. Anita Wölfl, 2005. "The Service Economy in OECD Countries: OECD/Centre d'études prospectives et d'informations internationales (CEPII)," OECD Science, Technology and Industry Working Papers 2005/3, OECD Publishing.
    17. Nicola Brandt, 2004. "Business Dynamics in Europe," OECD Science, Technology and Industry Working Papers 2004/1, OECD Publishing.
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    Cited by:

    1. Mr. Marcello M. Estevão & Ms. Evridiki Tsounta, 2010. "Canada's Potential Growth: Another Victim of the Crisis?," IMF Working Papers 2010/013, International Monetary Fund.
    2. Centre for the Study of Living Standards, 2005. "What Explains the Canada-US ICT Investment Intensity Gap?," CSLS Research Reports 2005-06, Centre for the Study of Living Standards.

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    More about this item

    Keywords

    Labour Productivity; Productivity; Productivity Growth; Investment; Information Technology; Information and Communication Technologies; Canada; United States; R&D; Productivity Comparisons; OECD;
    All these keywords.

    JEL classification:

    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • O51 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - U.S.; Canada
    • O57 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Comparative Studies of Countries

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