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A Comparison of Canadian and U.S. Productivity Levels: An Exploration of Measurement Issues

  • Tanguay, Marc
  • Baldwin, John R.
  • Wong, Fanny
  • Maynard, Jean-Pierre
  • Yan, Beiling

This paper examines the level of labour productivity in Canada relative to that of the United States in 1999. In doing so, it addresses two main issues. The first is the comparability of the measures of GDP and labour inputs that the statistical agency in each country produces. Second, it investigates how a price index can be constructed to reconcile estimates of Canadian and U.S. GDP per hour worked that are calculated in Canadian and U.S. dollars respectively. After doing so, and taking into account alternative assumptions about Canada/U.S. prices, the paper provides point estimates of Canada's relative labour productivity of the total economy of around 93% that of the United States. The paper points out that at least a 10 percentage point confidence interval should be applied to these estimates. The size of the range is particularly sensitive to assumptions that are made about import and export prices.

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File URL: http://www5.statcan.gc.ca/olc-cel/olc.action?ObjId=11F0027M2005028&ObjType=46&lang=en&limit=0
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Paper provided by Statistics Canada, Analytical Studies Branch in its series Economic Analysis (EA) Research Paper Series with number 2005028e.

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Date of creation: 20 Jan 2005
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Handle: RePEc:stc:stcp5e:2005028e
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Web page: http://www.statcan.gc.ca

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  1. Baldwin, John R. & Harchaoui, Tarek, 2002. "Productivity Growth in Canada," Productivity Growth in Canada, Statistics Canada, Economic Analysis, number stcb6e, December.
  2. D. J. Daly, 1972. "Uses of International Price and Output Data," NBER Chapters, in: International Comparisons of Prices and Output, pages 85-141 National Bureau of Economic Research, Inc.
  3. David Card & Richard B. Freeman, 2002. "What Have Two Decades of British Economic Reform Delivered in Terms of Productivity Growth?," International Productivity Monitor, Centre for the Study of Living Standards, vol. 5, pages 41-52, Fall.
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