While Canada may have been established with the vision of a single free market within our borders, this is not the case today. The hodge-podge mix of tariffs and regulations imposed by the provinces have worked in concert to vastly slow the free flow of goods and services.
All provinces would benefit in terms of GDP per capita from eliminating trade barriers, but the gains would be largest amongst the poorest provinces, finds this report from the Montreal Economic Institute. For instance, if internal trade barriers had disappeared in the year 2000, Prince Edward Island’s GDP per capita in 2018 would be only 14 percent below Ontario’s, rather than the 24 percent lower it actually is.
Establishing a one-market system in Canada for goods and services is not only smart economically, it is an overwhelmingly popular idea amongst Canadians as well. According to the 2020 MBA Recherche poll results contained within this report, the vast majority (84 percent) think that they should be able to exchange goods and services anywhere within Canada without restrictions.
Being able to do so would benefit all Canadians, the author’s write.
“Differing safety standards, technical standards, occupational licensing, and residential obligations — and even outright protectionism — have created artificial costs for Canadians as producers, consumers, and taxpayers, thereby reducing their standard of living.”
This report was prepared by Olivier Rancourt, Economist at the MEI, and Krystle Wittevrongel, Public Policy Analyst at the MEI, with the collaboration of Miguel Ouellette, Director of Operations and Economist at the MEI.
