By David MacKinnon and Marco Navarro-Genie Even a brief glance at the economies of the Atlantic Region in early 2016 indicates that a time of reckoning is at hand. Deficits are growing and threaten to become solvency crises. Regional outmigration has slowed down but continues. Remittances from Western Canada are almost certainly falling rapidly. For [...]
AIMS Fellow David MacKinnon suggests that the new government in Ottawa has a unique opportunity to help reset the region out of dependency and into the path of prosperity.
Election campaign should focus more on Canada's crumbling "fiscal architecture" among other important, yet ignored, concerns, says AIMS Fellow David McKinnon. By: Robert Benzie
All three maritime provinces rely heavily on equalization payments from the federal government to fund their programs. Ontario's emergence as a "have-not" province however has placed pressure on the equalization system and is leading to reduced equalization payments as a share of GDP in all three provinces. Last year, approximately two-thirds of all [...]
Canada's equalization program is motivated by good intentions. However, it creates perverse incentives for provincial governments to shun sensible economic opportunities. For example, although natural resource development is an important driver of economic growth in Canada and despite several studies that point towards the economic benefit of shale gas development, provincial governments in [...]
AIMS Director of Research Ben Eisen and Fraser Institute Senior Fellow Mark Milke discuss their new paper "Nova Scotia, New Brunswick, and the Equalization Policy Crutch" and argue that evidence from across North America indicates that natural resource development is an important driver of economic growth.
Last week, a group of university and private sector analysts released a report on shale gas that included an economic study that predicted New Brunswick could create between 5,900 and 7,900 full-time jobs, both directly and indirectly, if the industry annually drilled between 150 and 200 wells. That would translate into between $1.4 billion and $1.8 billion in economic growth. Another report released this week by the Atlantic Institute for Market Studies stated that shale gas could help enrich the region.
An essay published by two of Canada’s leading think-tanks–the Fraser Institute and Atlantic Institute for Market Studies–suggests New Brunswick and Nova Scotia dependence on federal equalization money is acting as a disincentive for natural resource development in those two provinces. New Brunswick has received $14.5 billion in equalization over the past decade and this gift of cash funnelled from the more prosperous regions of Canada still represents close to 40 per cent of provincial revenues.