IDEAS home Printed from https://ideas.repec.org/h/sls/secfds/16.html
   My bibliography  Save this book chapter

Has Quebec’s Standard of Living Been Catching Up?

In: The State of Economics in Canada: Festschrift in Honour of David Slater

Author

Listed:
  • Pierre Fortin

Abstract

Quebec’s relative growth performance with Ontario has always been an issue of concern for economic historians. In his paper Pierre Fortin discusses trends in Quebec’s real domestic income relative to that in Ontario over the last half-century. He finds that per capita real domestic income in Quebec, as a percentage of that in Ontario, fell from 78 per cent in 1926 to 74 per cent at the end of the 1950s, with a particularly steep decline during World War II. After WWII, it then started an upward climb, reaching 86 per cent in 1999, and exhibited a particularly strong performance in the 1975–85 period. Fortin sees the WWII slump related to the proportionally smaller number of men in Quebec enrolled in the armed forces, which reduced the share of overall military pay going to Quebec. He attributes what he calls the big bubble of the 1975–85 period to the strong cyclical expansion associated with a large number of major projects accompanied by a wage explosion. The key development Fortin seeks to explain is the 12 percentage point increase in Quebec’s per capita real domestic income from 74 per cent of that in Ontario in 1960 to 86 per cent in 1999. He decomposes this change into three sources: productivity, employment and the demographic structure, and finds that faster growth in output per worker in Quebec was the most important factor, accounting for 55 per cent of the decline in the gap. In 1999, output per worker in Quebec was 93 per cent of that in Ontario, up from 83 per cent in 1954. Faster growth in the working age population accounted for 35 per cent of the decline in the income gap, and more rapid rate of increase in the employment rate for 10 per cent. Fortin points out that the massive investment Quebec has made in education has greatly reduced that gap in average years of schooling between persons in Quebec and Ontario. Indeed, in 1991 the average 25-year-old man had received more years of schooling in Quebec than in Ontario. This development bodes well for future income growth. Equally, Quebec has also done well in investment in infrastructure and equipment and in research and development. Fortin explains the continued income gap with Ontario by the long gestation period required before the education revolution filters up to all age groups.

Suggested Citation

  • Pierre Fortin, 2001. "Has Quebec’s Standard of Living Been Catching Up?," The State of Economics in Canada: Festschrift in Honour of David Slater,in: Patrick Grady & Andrew Sharpe (ed.), The State of Economics in Canada: Festschrift in Honour of David Slater, pages 381-402 Centre for the Study of Living Standards.
  • Handle: RePEc:sls:secfds:16
    as

    Download full text from publisher

    File URL: http://www.csls.ca/events/slt01/fortin.pdf
    Download Restriction: no

    More about this item

    Keywords

    Canada; Quebec; Ontario; Living Standards; Income; Real Income; Growth; Income Growth; Relative Income; Productivity; World War 2; World War II; WWII; Demographic Structure; Demography; Employment Rate;

    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
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • N32 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy - - - U.S.; Canada: 1913-

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sls:secfds:16. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (CSLS). General contact details of provider: http://edirc.repec.org/data/cslssca.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.