Dividing the Debt: Avoiding the Burden

Although dividing Canada's public debt would have economic consequences, it would likely be decided by political bargaining with little weight given to economic criteria. Such political bargaining could easily magnify the costs of debt division through spillovers to other policies. This potential for needless loss exists at all three stages of Quebec separation: posturing, bargaining and enforcement. This study makes recommendations on how the costs of dividing Canada's debt could be minimized.