The Canadian economy faces serious growth headwinds over the next few decades, and policy makers across the country should be thinking hard about how to improve growth. Many policy options will likely be considered, but finance ministers will soon find that there are no quick fixes. Economic growth is a complex process.
The broadest measure of average income is per capita gross domestic product (GDP), which is simply the overall national income divided by the number of people. Over long periods of time, this measure grows for two reasons: improvements in labour productivity and increases in the labour force participation rate.
Since 1970, per capita GDP in Canada has increased at an average rate of 1.3 per cent a year –…
The Ontario government announced recently that it will give cities the power to require home builders to set aside housing in new developments for low-income families. Municipal politicians might like the plan, but it will be costly for home buyers and is not the most effective way to give low-income families good housing.
The province’s plan is called inclusionary zoning. Inclusionary zoning is about changing the way social housing is built in our cities. Currently, the City of Toronto owns 62 per cent of government-subsidized housing. Inclusionary zoning would put more of the burden of building low-income housing on private developers instead.
Why do governments support such a change?
First,…
The Parliamentary Budget Officer’s tussle with the Department of Finance about missing numbers in the latest federal budget projections shows that even experts have problems deciphering governments’ fiscal plans.
And if the experts have problems, how about non-experts – legislators who vote on budgets and approve spending estimates, citizens concerned about public affairs or taxpayers who pay for it all? Getting transparent financial reports from Canadian governments will take a lot more work.
Even before Finance Minister Bill Morneau rose in the House of Commons to deliver the March 22 budget, analysts in the budget lock-up were scratching their heads. And not just because, in a 419-page document, the critical…
