Potential Gains for Canadians from More CompetitiveRegulation Settings
Press Release – Ottawa, June 28, 2018
The Centre for the Study of Living Standards (CSLS) today released the Spring 2018
issue of its flagship publication, the International Productivity Monitor. The table of contentsof the issue with links to the articles is below.
The issue contains seven articles featuring the most recent research on a wide range ofproductivity topics. Particularly relevant from a Canadian perspective are the articles on thepotential gains from more competitive regulation settings and the role of capital measurement
issues in accounting for slower productivity growth in Canada.
In the lead article Aled ab Iorwerth and Carlos Rosell from Finance Canada provide
econometric evidence that making Canada’s regulatory framework as competition friendly asthat in the United States would produce significant economic dividends for the country.
Highlights include:In 2013, Canada ranked 16th out of 29 countries in terms of overall Product Market
Regulation (PMR) as shown by the OECD, well behind the third place performance ofthe United States. On the trade and investment component of the PMR, Canada ranked
26th out of 29 countries, or fourth last.

GDP per capita in Canada could be 2 per cent higher in five years and 5.3 per cent higher
after 20 years if Canada’s foreign direct investment (FDI) regulations were ascompetitive as those in the United States.

There are a range of estimates of the benefits, but even in the lower bound (at the 95 percent confidence interval), the gains would be 0.7 per cent and 1.8 per cent of GDP per
capita for the medium and long term respectively.

Wulong Gu from Statistics Canada estimates the contribution of three types of capitalthat are not currently incorporated into the standard growth accounting framework, namelyintangible capital, natural resource capital, and public infrastructure capital, to the productivity
slowdown. He also estimates the impact of changes in capacity utilization on the slowdown. The
inclusion of natural capital and changes in capacity utilization reduce the MFP slowdown, while
the inclusion of intangible capital and public capital in capital input make the slowdown larger.

International Productivity Monitor
Number 34, Spring 2018

Cover

Masthead

Table of Contents

Andrew Sharpe
Editor's Overview

Aled ab Iorwerth and Carlos Rosell
The Gains from More Competitive Regulation Settings in CanadaWulong Gu
Accounting for Slower Productivity Growth in Canada after 2000: Role of Intangible Capital, Natural Capital,Infrastructure Capital and Capital Utilization

Paul Conway

Can the Kiwi Fly? Achieving Productivity Lift-off in New ZealandChiara Criscuolo and Jonathan Timmis
The Changing Structure of Global Value Chains: Are Central Hubs Key for Productivity?

Alexander Murray
What Explains the Post-2004 U.S. Productivity Slowdown?

John Fernald
Cyclical Downturn or Slowing Trend? A Review Article on "Productivity Puzzles across Europe"

Chad Syverson
Review Article on "Capitalism Without Capital: The Rise of the Intangible Economy" by Jonathan Haskel and Stian
WestlakeTopFor further information, please contact:
Andrew Sharpe
Executive Director
Centre for the Study of Living Standards
613-233-8891
andrew.sharpe@csls.ca
The Centre for the Study of Living Standards (CSLS) is a national, independent, Ottawa-based
not-for-profit research organization. Its primary objective is to contribute to a better
understanding of trends and determinants of productivity, living standards, and economic wellbeing in Canada through research.