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CGE models and carbon tax incidence
Posted by Marc Lee under BC, carbon pricing, economic models.
November 24th, 2014
Comments: 3
A colleague of mine pointed out a relatively new paper about the distributional impacts of BC's carbon tax. In my work, we look at actual energy expenditures by different household groups, and because lower income groups spend a greater share of their income on (carbon-intensive) energy, any carbon tax is regressive. But that regressivity ultimately depends on what you do with the revenues, and can be compensated with a credit. In BC's case, when the carbon tax was instituted, there was a decent low-income credit that made the overall regime progressive, but as the tax increased from $10 to $30 per tonne, the credit did not keep up, and the current regime is regressive. Not massively so, but it is important to get the details right before scaling up.
The authors take issue with my work in the area for only looking at the direct effect of the carbon tax, and not a range of economy-wide impacts that then feed back into distribution:
Recent research in other contexts, however, has found that the incidence of energy and carbon taxes is dictated by general equilibrium responses and not well approximated by partial equilibrium studies such as Lee (2011) and Lee and Sanger (2008), which only consider the distributional effects resulting from households' consumption of the taxed fuels and other carbon-intensive products.
It's certainly an interesting argument, and they come up with a startling finding:
Using the model, we find that the existing BC carbon tax is highly progressive even prior to consideration of the revenue recycling scheme, such that the negative impact of the carbon tax on households with below-median income are smaller than that on households with above-median income. We show that our finding is a result of welfare effects of a carbon tax being determined primarily by the source of a households' income rather than by the destination of its expenditures.
The model in question is a Computable General Equilibrium (CGE) model, which should raise some alarm bells. To assess the impact of trade agreements and tax changes, some economists have used CGE models, which develop a system of equations to model the economy, then shock it with a policy change to look at impacts once everything settles. Unfortunately, CGE is a deeply flawed approach that incorporates all of the market fundamentalism of neoclassical economics. Moreover, they give the appearance of making empirical estimates when really what is being generated is a function of the assumptions being made. Here's The Economist magazine on problems with CGE models:
[T]he results of CGE models flow from the presuppositions of their authors. Most empirical exercises confront theory with numbers—they test theories against the data; sometimes they even reject them. CGE models, by contrast, put numbers to theory. If the modeller believes that trade raises productivity and growth, for example, then the model's results will mechanically confirm this. They cannot do otherwise. In another context, Robert Solow, a Nobel prize-winner, has noted the tendency of economists to congratulate themselves for retrieving juicy plums that they themselves planted in the pudding.
In this particular paper, what assumptions are notable? "The model is based on the principles of general equilibrium theory. It combines microeconomic detail to project agents' behaviour with the requirement of market clearing" and "Markets for all factors are assumed to clear perfectly (i.e., there is no friction in any of the factor markets). Labour is treated as mobile between sectors in each region but immobile between regions, as is conventional." Also: "For each region and each sector, nested constant elasticity of substitution (CES) cost functions describe the price-dependent use of capital, labour, energy and materials for the production of commodities other than primary fossil fuels. Producers choose to substitute between different inputs (labour, capital, different types of energy and materials) to maximize profits."
With those whoppers as starting points, they shock the model with a simulated carbon tax, then conclude on distribution: "To sum up, the progressive character of the carbon tax is mainly caused by the greater decline in real wages compared to the relative increase in real capital earnings. Households in the higher income deciles are more dependent on labour income than households in the lower deciles, which means they are hit harder by the drop in real wages."
So higher energy prices cause diminished economic activity and associated wage reductions, which disproportionately affect high-income earners, according to the model. For such a change in prices, however, it may also be the case that other low-carbon sectors are stimulated. Indeed, we know that capital investment in renewables generates more jobs per dollar as that invested in fossil fuels. And as a general note, there are both income and substitution effects for any price change, and these move in opposite directions. So it's not obvious that the overall impact of a carbon tax is being modeled properly – there is a lot we do not know. But I suspect these results are an artifact of the assumptions in the model.
On the breakdown of income, transfer income is relatively more important to low-income households, capital income is relatively more important higher up the distribution. Some of the gain is attributed to transfer income being indexed to the CPI, compensating for higher energy costs. While this may be true for federal transfers like OAS and CCTB, it certainly is not the case for social assistance in BC, a transfer most relevant to this analysis.
But the real distributional problem is on the expenditure side: it's hard to get around the prima facie empirical case that low-income households spend a greater share of their income on energy, and therefore get hit with a higher share paid in carbon tax. This paper seems like a lot of hand-waving to me. Given the track record of CGE models, a quasi-empirical approach that is highly driven by the assumptions being made, I suggest some skepticism. And such a paper can be problematic to the extent that it endorses carbon pricing initiatives that allow proponents to ignore distributional impacts.
IPCC doom, gloom and an LED light at the end of the tunnel
Posted by Marc Lee under climate change.
November 14th, 2014
Comments: 1
The latest from the Intergovernmental Panel on Climate Change is a super-synthesis of the state of agreed knowledge about climate change, adaptation and mitigation. Imagine thousands of research papers summarized in three major volumes (released over the past year), with this new report the grand summary of that. And even that condensed into a 40-page summary for policymakers.
Now I will humbly boil that down to a few key observations: climate change is happening and costs are piling up; it's caused by human activity, primarily the combustion of coal, oil and gas; staying on our current pathway risks ever-greater danger of irreversible adverse impacts around the world; and, perhaps most importantly, we still have time for a soft landing if we act quickly.
To me, the most important concept advocated by the IPCC report is that of a carbon budget. There is a finite amount of carbon we can combust before we push into the really dangerous territory (aka 2 degrees C above pre-industrial levels). How big that global carbon budget is depends on your appetite for risk, but the IPCC says about 30 years worth of emissions at current levels would give a 2/3 chance of staying below 2 degrees.
I'm not crazy about those odds. It's like someone telling you there is a 1 in 3 chance your house will burn down, and you would henceforth be homeless forever.
The key point is we need to establish a global carbon budget, and figure out how to divvy that up fairly so we can use our remaining fossil fuels to transition to a clean energy economy. This is a classic economic problem: how to allocate resources subject to a budget constraint, as the vast majority of fossil fuel reserves (66-80% globally) represent "unburnable carbon" that needs to stay underground.
To pull this off, it goes without saying we have to pull together. This is a cross-planetary collective action problem, which requires government regulation, taxation and public infrastructure spending. The IPCC concludes that the economics of this transition are favourable: there may be a minor dent in our GDP several decades out, but there would also be substantial co-benefits from action, such as better health outcomes.
The timing of this IPCC report matters like no other, coming out out a year before the crucial 2015 Paris meetings of the United Nations Conference on Climate Change, at which our leaders are to sign off on a new global treaty to constrain carbon emissions.
Or not. So far our leaders have been good at making grand promises about emission reduction targets way in the future, while not taking action consistent with meeting those targets. And the last time we got our hopes up from a new deal on climate, in Copenhagen in 2009, it was met with bitter disappointment, as governments could not find the political will to address the issue.
That said, there are glimmers of hope. This past September, we saw the largest march for climate action in history, with 400,000 in New York City and satellite marches around the world. Resistance to new fossil fuel infrastructure (like pipelines, LNG terminals, and coal ports) is making life difficult for fossil corporations. Divestment campaigns have popped up around the world. And the cost of renewable energy is now economical, even given the huge subsidies we provide to fossil fuel production and consumption.
To get on the right path, we need to overcome two things: the power and influence of fossil fuel companies, who have done a masterful job confusing the issue through denial campaigns, and getting their political allies into power; and the belief that collective action through our governments is detrimental to the economy.
This week's historic accord between the US and China to reduce emissions is another good sign, and they join the European Union in pledging game-changing commitments ahead of Paris. Together, these three represent more than half of global emissions.
For Canada, this also means we must stop relying on what's easy (digging up ever-more fossil fuel resources for export) and start rethinking "responsible resource development" as the strategic management of fossil fuel reserves in order to maximize shared prosperity, within the context of a carbon budget. The next federal election would be a great time to have this conversation.
So 2015 is shaping up to be a pivotal year, in Canada with a federal election, and for the world as a whole. People increasingly realize that climate change is not a distant possibility that might happen to polar bears 100 years on, but something that is happening now. Amid the gloom of the science on climate change lies the possibility for a tectonic shift in our economy and the politics of carbon. A bright green future is possible but we are going to have to work for it, together.
PS. Hat tip to CCPA Monitor editor Stuart Trew, who pushed me to write this, and who contributed the title.
Why the economy sucks (in one chart)
Posted by Toby Sanger under budgets, Conservative government, macroeconomics, public services, stimulus, taxation.
November 12th, 2014
Comments: 3
(The following is something I've prepared for the next issue of CUPE's Economy at Work, a popular economics quarterly publication I produce.)
In his annual Economic and Fiscal Update (EFU), finance minister Joe Oliver told Canadians that while the federal government will finally record a surplus next year after seven years of deficits, we can't expect the economy to grow much faster than the slow growth we've experienced since the financial crisis, with economic growth expected to average just 2.4% over the next four years.
Economic growth in this recovery is a third slower than in the recoveries of the 80s and 90s while job and wage growth has also been dismal. And despite all the spending cuts they've made, we also can't expect the federal government to have much extra money because the additional tax cuts they've promised are eating up a lot of the surplus.
If we have a balanced budget and federal taxes have been cut to the lowest share of the economy in 70 years, why is out economy growing so slowly? It certainly isn't because interest rates are low: instead they're close to historic lows, so low they could fuel another asset boom and bust. It isn't because businesses lack money to invest: they have a record $600 billion of excess cash they aren't investing in the economy. It isn't because we're lacking labour: there are over 1.2 million officially unemployed with hundreds of thousands more underemployed.
So if everything is in place according to the Conservatives' economic ideology—balanced budgets, low taxes, low interest rates, corporations flush with cash, excess labour, free trade, low wage growth—why does the economy suck?
The answer is right under Joe Oliver's nose, in his department's publications and media releases—and is illustrated with the chart below.
Good Results from Latin American Elections (Guest Post by Paul Pugh)
Posted by Jim Stanford under Latin America.
October 31st, 2014
Comments: 2
Paul Pugh is a long-time progressive activist, trade unionist, and city councillor from Thuunder Bay, Ont., who has guest-written previous posts for us on economic policies in Uruguay. Here is a short report from Paul on the outcome of recent crucial elections in Latin America. Thank you Paul, and congratulations on your own re-election this week to Thunder Bay city council!
The re election of Dilma Rousseff was the most important event this past Sunday, as it enables continuation of the PT (Workers' Party) direction within and outside of Brazil. This is very important for the region, as Brazil is by far the most important country. I'm still trying to analyze the legislative, state and municipal results. Brazil's political parties and alliances are complex.
Uruguay also held national elections on Sunday. For the pres/vp ballot, the FA (Broad Front – left coalition) won 47.9%, just short of a majority, so there will be a second round Nov 30. The opposition Blancos (Whites) received 30.9%, and the Colorados (Reds – but not in the political sense) received 12.8%, the Independent Party 3.03%. So it looks good for Nov 30, but it's not over until the ballots are counted Nov 30. For the legislature, the FA won 50 of the 99 Chamber of Deputies, and 15 of the 30 Senate seats – if the FA wins Nov 30, it will have a majority in the Senate, as the VP has a senate vote. The FA also enlarged its base in departmental governments (like provinces), from 11 (in 2010 election) to 14, of the 19 departments. So, Uruguay confirmed its support for the FA.
The election of Chile's Bachelet (and majorities in both chambers of the legislature), Evo Morales' huge win for a 3rd consecutive term in Bolivia with corresponding majorities for his party MAS (Movement for Socialism), Dilma's re election in Brazil, and Uruguay's re election of the 3rd consecutive FA government bodes well for the region.
Minimum Wages and Employment Outcomes
Posted by Jim Stanford under employment, minimum wage, unemployment.
October 30th, 2014
Comments: 2
Last week my Unifor colleague Jordan Brennan and I published a study through the CCPA Ontario office examining the historical empirical evidence regarding the link between changes in minimum wages and employment outcomes. We find there is no robust evidence in Canadian historical data that increases in real minimum wages cause either lower employment or higher unemployment, even when we focus on key segments of the labour market that are most reliant on low-wage labour (including youth and the retail and hospitality sectors).
The full study, titled Dispelling Minimum Wage Mythology: The Minimum Wage and the Impact on Jobs in Canada, 1983–2012, is available here. Read more »
Economics 101
Posted by Nick Falvo under economic crisis, economic history, economic literacy, economic models, economic thought, financial crisis, heterodox economics, history of economic thought, progressive economic strategies.
October 26th, 2014
Comments: 6
On October 21, Chris Ragan wrote a column for the Globe and Mail titled "In defence of Economics 101." The link to his column is available here.
On October 24, Marc Lavoie, Louis-Philippe Rochon and Mario Seccareccia replied to him. The link to their response is available here.
Bank of Canada, Exports, and LMI
Posted by Angella MacEwen under Bank of Canada, economic growth, federal budget, fiscal policy, labour market, monetary policy, public infrastructure.
October 23rd, 2014
Comments: none
Much has been made about Stephen Poloz's decision to abandon 'forward guidance' in Bank of Canada rate setting announcements for the time being. Critics bemoan the loss of direction from the Bank. But Poloz's comments yesterday were chock full of guidance on how the Bank sees Canada's economic situation.
Having been disappointed by the failure of Canada's export sector to resume investment or show any signs of life, researchers at the Bank investigated the performance of 2,000 product categories, and found that about 500 of those had very nearly been wiped out following the 2008 – 2009 recession. Further investigation found a permanent loss of capacity in some manufacturing export sub-sectors. Most surviving manufacturing exporters are still operating at or below capacity. This means we shouldn't expect a whole lot of business investment in these sectors any time soon.
This permanent loss of capacity isn't truly permanent, we can rebuild, but doing so will take more time, and will wait until conditions are much more certain. This has disastrous consequences for workers, particularly in southern Ontario where much of the loss has been located.
Stephen Poloz's statement is clear on this. The size of the output gap is somewhat deceptive because of this loss of capacity. A clearer picture of the weakness Canada is experiencing shows up in the labour market gap. Which the Bank very carefully measures, by the way. The Bank's aggregate LMI diverged from the unemployment rate in late 2012. TD Economics put together their own aggregate labour market indicator, that also shows the labour market is weaker than the unemployment rate shows.
This might be the perfect time for some public infrastructure investment (as recommended by the IMF), say, in affordable childcare spaces.
The Troubled Economics, and the Curious Politics, of the Canada-Korea Trade Deal
Posted by Jim Stanford under free trade, Korea, NDP.
October 17th, 2014
Comments: 4
There are many motivations to explain the Harper government's rush to sign free trade deals. Since coming to power, the Conservatives have implemented 6 FTAs, have "concluded" 2 more (with Korea and, purportedly, with the EU), and have fully 14 other FTA negotiations on the go. Read more »
The Novel Observations of Jean Tirole?
Posted by Wenonah Bradshaw under economic models, financial regulation, history of economic thought, regulation.
October 14th, 2014
Comments: 1
French economist Jean Tirole has won the 2014 Nobel Prize in Economics for his work on industrial organization and regulation, in particular his insights into oligopolies. "Who is Jean Tirole?, many non-economists and some economists are asking today. The MIT-educated, Toulouse-based professor is a key figure in the New Industrial Organization (IO) movement. The movement, with its roots in the 80s , sought to formalize IO, drawing heavily on new tools provided by game theory. I first came across Tirole's name as the author of The Theory of Industrial Organization (1988), the main textbook prescribed in the grad level IO course that I chose not to take in 2000. However, as I now scramble to get quite familiar with the IO of banking, I can appreciate an overarching insight of Tirole's: there is no general theory of IO or regulation! Every industry is different; they are dynamic and require regulations or competition policies that address their particular conditions.
But Tirole's contributions don't end there. In the hours since the announcement by the Nobel committee, news and blogs have been rife with summaries of the essential Tirole. Yet as I digest these, I can't help recall a passage written by the late Mark Blaug in a 1998 Challenge article:
In the field of industrial organization, which has been more systematically invaded by game theory than any other branch of economics, its principal effect has been to pour old wine into new bottles. It is difficult, nay, impossible to think of a single novel observation that has come out of the "new' industrial organization infuse by game theory that was not already part and parcel of the "old" industrial organization based as it was on the so-called structure-conduct-performance approach to business behavior."
Blaug goes on to compare an old-style textbook like Scherer and Ross' "Industrial Market structure and Economic Performance" (1990) and Tirole's 1988 text, asserting that "there is nothing of substance in the latter that is not also in the former and indeed there is much less substance in the latter than in the former."
So, as we scurry to get up to speed on the latest dismal scientist to get named to the hall of fame, it may be worthwhile to consider the whole history of industrial organization, with its pioneering theorists of imperfect competition, such as Joe Bain , Edward Chamberlain and Joan Robinson.
Job Numbers Surprise
Posted by Angella MacEwen under labour market, part time work, young workers.
October 10th, 2014
Comments: 4
For the first time in a while, Statistics Canada gives us some good news on the job front. 74,000 net new jobs added in September, certainly nothing to sneeze at. Still, we would need to keep this pace up every month for the next year to close the employment gap left by the last recession.
On the graph below, this month's huge uptick barely makes a dent. The blue line is how many jobs we have, and the dotted pink line is how many we would have if the employment rate were 63.6%.
This holds true for workers age 15-64 as well, but in terms of total employment is a bigger issue for men (it is still a he-cession). The potential job growth lines (shown as dotted lines on the graph), are based on pre-recession employment rates. A year and a half ago, women were very close to their potential employment rate, but the trend has fallen off a bit since then.
More women work part-time than men, for various reasons, but it's often to accommodate unpaid care work or because they can't find full-time work. The number of men and women working part-time involuntarily is higher this September than it's been in a month of September since 1997.
And for young workers who are new to Canada, there has been no recovery. In the chart below I compare actual and potential employment for the months of September since 2006. To graph potential I use both the Canadian born young worker employment rate, and the new Canadian young worker employment rate.
Overall, recent immigrants have seen fewer jobs return. The unemployment rate for recent immigrants (less than 5 years) stood at 13.7%, compared to 6.5% for Canadian born workers. We don't just need to create jobs, we need to create good jobs, and they need to be available to everyone.
Labour market musings
Posted by Angella MacEwen under Employment Insurance, labour market, unemployment, women.
October 9th, 2014
Comments: none
Just a short post ahead of the job numbers that come out from Statistics Canada tomorrow. Five years after the end of the last recession, and Canada's labour market is still limping along. And it seems to have taken a turn for the worse recently.
While the Conservative government crows about one million net new jobs, they conveniently forget to mention that we would need to add another 880,000 new jobs to the Canadian economy to catch up to our pre-recession employment rate.
On average, that's about 73,000 jobs per month, every month, for a whole year. This is unlikely to happen given our current job creation trends. Over the past year, we've added fewer than 7,000 jobs per month, which is only about one-tenth of what we need to put unemployed Canadians back to work.
And as we always hear, demographics matter. Here's what that chart looks like for men and women between the ages of 15 and 64.
We're short 300,000 full-time jobs for workers 15-64. In other words, in order for the employment rate of working age Canadians to return to its pre-recession level, we need to add 300,000 full-time jobs in that age category.
That's half the number of jobs that went missing in the depth of the recession, but double where we were a year and half ago. The situation is getting worse, not better.
Another issue of growing concern is the continued high rate of long term unemployed workers (highlighted by today's PBO report on EI).
Just a few things to keep in mind when you're reading the labour market analysis tomorrow, whatever the monthly numbers say.
Posted by Wenonah Bradshaw under Uncategorized.
October 7th, 2014
Comments: none
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Finally, don't hesitate to ask the editor for some advice, even before you submit the paper, and especially if you don't understand the reviews. Often, reviewers will contradict each other, and the editor may offer you guidance in what to focus on. The editor will be more than happy to help you interpret the reviews.
19. Get involved and offer to help
Offer to serve as a referee before you submit to a journal: finding good referees is not easy. And if you are sent an article to review, do a good job and do it by the deadline given to you. Of course, this won't guarantee a future paper of yours will be accepted, but you always want to be on the good side of the editor. Refereeing well is one way to do this, and in many cases this is how we nominate people to our editorial boards.
Good Luck! And we look forward to reading your submissions!
The Editors:
VALENTIN COJANU, Founding Editor, Journal of Philosophical Economics
PAUL DAVIDSON, Founding Co-Editor Emeritus, Journal of Post-Keynesian Economics
ALICIA GIRON, Editor, Problemas del Desarrollo
JOHN HARVEY, Editor, Real-World Economics Review
ECKHARD HEIN, Co-editor, European Journal of Economics and Economic Policies: Intervention
HEINZ D. KURZ, Co-editor, Metroeconomica
STEVE PRESSMAN, Co-editor, Review of Political Economy
JACK REARDON, Founding Editor, International Journal of Pluralism and Economics Education
LOUIS-PHILIPPE ROCHON, Founding Co-Editor, Review of Keynesian Economics
ALLESANDRO RONCAGLIA, Editor, PSL Quarterly Review and Moneta e Credito
BARKLEY ROSSER, Founding Editor, Review of Behavioral Economics
NERI SALVADORI, Co-editor, Metroeconomica
MALCOLM SAWYER, Editor, International Review of Applied Economics
MARIO SECCARECCIA, Editor, International Journal of Political Economy
Who's afraid of free trade with Europe?
Posted by Angella MacEwen under aboriginal peoples, economic growth, Europe, free trade, public services, trade disputes.
September 25th, 2014
Comments: 2
The prospect of freer trade with European nations is generally popular among Canadians. And why shouldn't it be? Doesn't the Canadian left repeatedly point to the advantages of many European social and economic institutions? Who could argue with lower prices for European cheese, wine, or chocolate?
After all, we've been waiting for years for the Canadian economy to pivot to export-led growth, and how can we do that without free trade deals. This is the government's line. (Even though classical economic theory would say that trade deals are meant to benefit consumers, not exporters).
Well, there are a number of reasons to be concerned about the Canadian-European Comprehensive Economic Trade Agreement (CETA). The first one is that it isn't just a trade deal. Sure, it eliminates the already low non-agricultural tariffs between Canada and the EU.
And if it stopped there we wouldn't be having this conversation.
But when advocates think a major selling point of the agreement is that: "It's not just a trade agreement. It reaches into other regulatory areas and areas of social and economic policy", we're going to want to have a chat with some policy makers.
The CCPA has gathered analysis of CETA's leaked text from a wide range of experts, to help make sense of the CETA. I've summarized some of the key issues below.
Investor State Dispute Resolution
The most problematic element is the level of protections that investors receive under the CETA. These investor protections effectively constrain the ability of governments at all levels to introduce new regulations or new public services. Scott Vrooman, a comic who also happens to be a trained economist, humorously summarizes the problems with Investor State Dispute Mechanisms nicely in video and written formats, suggesting that Countries are Second Class Citizens under modern international trade agreements.
Under CETA an international body bypasses national courts, and can make decisions that apply retroactive financial penalties to governments. Compare this to the labour and environment chapter, which allows for a transparent but completely unenforceable dispute resolution process. This process is little more than high-level peer pressure, which we know to be a super effective tactic with our current Conservative government.
Food Security
One of the wins for Canada under CETA is increases in the quota of pork and beef that Canadian producers can sell into Europe. There remains considerable doubt about the ability of Canadian beef producers, in particular, to make use of the higher quotas. Canada is not able to fill our current quota of hormone free beef to the EU, let alone be in a position to take advantage of expanded quotas.
On the other hand, rules around procurement may threaten the increasingly popular "eat local" programs in many municipalities, schools, hospitals, and prisons. Local procurement of food is considered to be an important driver of local food security, as well as a key regional development policy, and part of reducing Canada's carbon footprint. The threshold for 'sub-central' entities is $330,000 CDN, much lower than current restrictions under NAFTA.
Indigenous Rights
Since Canada has pledged to endorse the UN Declaration on the Rights of Indigenous Peoples (UNDRIP), the federal government must consult with Indigenous Peoples. There is no question that an agreement as all-encompassing as CETA requires the government to receive Free, Prior, and Informed Consent from Indigenous Peoples whenever Indigenous rights may be affected. The level of secrecy around the process in negotiating CETA makes it very difficult to determine if any effort has been made by the federal government to even consider their responsibilities to Indigenous Peoples.
Maritime Services
Trade agreements are notoriously dense and difficult to parse, even when one has access to the official text and supporting documents. Maritime services is one example of a "surprise" found in the leaked final text of CETA.
During CETA negotiations, maritime industry players were assured that 'cabotage' would be left untouched by the agreement. Cabotage is a technical term that means "the movement of goods or passengers between two ports or places within a single state". Effectively, ships carrying goods between two Canadian ports must be registered in Canada and adhere to Canadian labour and safety standards. CETA starts to dismantle this, in allowing European shipping from Halifax to Montreal.
As the official text of CETA is released there will certainly be more surprises.
Public Services
Trade deals are about tariffs, right? The benefits are lower prices and better choices for consumers. If that is true, then why would a free trade agreement handcuff future governments in their ability to introduce new public services?
The CETA is negotiated under a 'positive' list rule, which means that any exclusions must be specifically listed. If you forget to list something, or something 'new' is created, then it automatically comes under the full weight of CETA. The 'positive list method is new to Europeans, and touted as 'modern' by Canadian and American trade negotiators.
This means that if a future federal government wants to introduce a public pharmacare or childcare program, they may face investor challenges under CETA. Or worse, future governments may abandon the idea of useful regulations and new public services altogether, because it will simply be too difficult.
This is what the CETA is meant to do – tie the hands of future governments to implement the will of the people. That's not what a trade agreement is should be allowed to do. No one is afraid of trade. We're afraid of corporate rights superseding democracy.
Is Harper right? Did corporate tax cuts really pay for themselves?
Posted by Toby Sanger under Conservative government, corporate income tax, corporate profits, taxation.
September 18th, 2014
Comments: 7
In a little noticed comment, Prime Minister Stephen Harper recently was reported to say:
"Dropping our tax rate has not caused the government's corporate income tax revenues to fall, which indicates that it does in fact attract business."
No one seems to have questioned his statement, even though it was made on the same day Canada dropped to 15th place on the World Economic Forum's index of global competitiveness from 9th in 2009. These rankings show corporate tax rates bearing little relationship to measures of global competitiveness.
Harper's statement puts him squarely in the company of the "Lafferites" and neo-conservatives who claim cuts to tax rates even at relatively low levels can pay for themselves by increasing economic activity and tax revenues.
The "Laffer curve" charts the relationship between tax rates and revenues. A tax rate of zero will obviously generate zero revenues while a rate of 100% also won't generate a lot of revenue either. Revenue-maximizing tax revenues are achieved at rates somewhere between these extremes.
While all economists acknowledge this relationship exists, there's a lot of disagreement about where the revenue maximizing rate and how steep the curves are. Progressive economists tend to agree revenue-maximizing tax rates are higher, while some neo-conservatives claim tax cuts even at low rates will increase revenues
Early advocates of these type of tax cuts argued that lower tax rates would increase economic activity and thereby revenues. However, there's little evidence changes in tax rates, except in more extreme cases, have a major impact on real economic activity.
Advocates of tax cuts also argue that cutting taxes can generate increased revenues from income and tax shifting. Individuals and companies can shift their income between jurisdictions or between different forms of income to take advantage of lower tax rates. The Prime Minister indicated this is what he thought happening when he said Canada's lower tax rate was attracting business, no doubt with the recently-announced takeover of Tim Horton's and merger with Burger King on his mind.
So is it true: have tax cuts actually led to higher revenues? Can we keep our Timbits and eat them too?
Liberal's EI Plan Rests on Bad Math
Posted by Angella MacEwen under Employment Insurance, labour market.
September 16th, 2014
Comments: 11
Joe Oliver recently announced a Small Business
Tax Cut, sorry, Job Credit. Economists across the ideological spectrum denounced it as poorly designed.
This opened up an interesting opportunity for a national debate about what we want E.I. to be – coverage right now is at all time lows, and the accumulated deficit from the last recession will soon be repaid in full.
The Liberal Party entered the EI debate by suggesting a one-year EI premium holiday for employers who hire new workers. It's disappointing that they completely ignored the possibility of expanding access. What's even worse is that their plan rests on some pretty terrible math.
How much do they think a one year EI premium holiday for new hires will cost? Why, they can create 176,000 jobs for the low price of $225 million / year.
Sure, you say, the maximum EI contribution for employers is around $1250 / year, and 176,000 * $1250 = $225 million. No problem.
But, wait! How do you define new job? And how many 'new jobs' are created in the Canadian economy in any given year? You might think that it's in the 176,000 range if you listen to any of the coverage of the Labour Force Survey release at the beginning of every month. But you'd be wrong.
The Labour Force Survey counts 'net new jobs', which is the the number of new hires minus the number of job leavers in a given month. Between August 2013 and August 2014, there was an average of 6,000 net new jobs every month.
But the total number of new hires is much larger than the number of net new jobs. People leave one job for another, and move into and out of the labour force regularly.
Although Statistics Canada doesn't measure new hires directly, it does ask "how long have you been in your current job?". We can say that people who answer "1 month or less" is a pretty good proxy for new hires. By this metric, there were approximately 3.7 million new hires in 2013. That's 310,000 per month.
The Liberals will have blown through their annual budget for the EI premium rebate about two weeks after it has been introduced.
This plan confirms two things. The Liberal Party of Canada is totally OK with an EI coverage rate of 36%, and they aren't really sure how the labour market works in Canada.
Of Rising Tides and Sinking Boats
Posted by Angella MacEwen under Alberta, labour market, temporary workers, wages.
September 15th, 2014
Comments: 4
Recently, Minister Kenney took to twitter to defend his decision to limit the number of precarious workers entering Alberta through the Temporary Foreign Worker Program. Again, the minister is to be applauded for his grasp of the situation. His changes do little to fix the actual problem though.
The evidence that he cited was the lack of wage growth among restaurant workers in Alberta. The graph below shows that, adjusted for inflation, restaurant worker wages in Alberta peaked in 2010, and have fallen since then by over $35 / week. At the same time, the overall average weekly wage has risen by $67 / week. Wages for retail workers haven't budged, and manufacturing wages have risen only slightly.
What is driving this? Workers bargaining power has been restricted in two ways. First, workers employed through the Temporary Foreign Worker program are tied to a single employer. Second, many are not allowed to unionize. If a worker is unhappy with the wages or working conditions of their job, they can neither band together to demand better, nor walk across the street to a better employer.
The result is that employers do not have to raise wages to attract and keep workers. If there is a sufficient supply of vulnerable labourers, then current non-TFWP workers may be easily disciplined with the treat of being replaced by a willing temporary worker.
Limiting the pool of workers whose bargaining power is restricted may improve the situation of non-TFWP workers somewhat, if it means that they are less likely to believe the treat of being replaced. But it does nothing to improve the situation for temporary workers.
If there is a need for more low-skilled workers in Alberta, then Alberta should open up temporary and permanent immigration for low-skilled workers. But all workers should be allowed to move between employers, and to bargain wages and working conditions through the union of their choice. The best way to enforce employment standards is by giving workers the power to stand up for themselves.
Update: A Petition of Academics Against the CCPA Audit
Posted by Wenonah Bradshaw under C. D. Howe Institute, Canadian Taxpayers Federation, Conservative government, Fraser Institute, Macdonald-Laurier Institute, petitions.
September 11th, 2014
Comments: 8
A guest blog post from Mario Seccareccia and Louis-Philippe Rochon.
After learning that the Canada Revenue Agency is auditing the Canadian Centre for Policy Alternatives on the grounds that it allegedly engages in politically partisan, biased and one-sided research activity, a number of university professors have drawn up an open letter asking the Minister of National Revenue place a moratorium on its audits of all the various think-tanks that claim charitable status, until such time when truly neutral criteria can be implemented in the selection and conduct of fair, transparent and even-handed periodic audits. Audits should be focused on the financial management and integrity of the organization, not on the content of the research it conducts. Why single out only one such research centre that happens to be more critical of government policy?
The open letter (below) was drafted by Professors Louis-Philippe Rochon (Laurentian University) and Mario Seccareccia (University of Ottawa) after consulting with a couple of colleagues from the PEF, namely Professor Marc Lavoie. It has circulated only over the last few days across Canada. The enormous support from hundreds of Canadian professors across disciplines has far exceeded all expectations. The list of signatories as of noon September 14 follows the open letter. Professor Louis-Philippe Rochon can be reached by e-mail at: firstname.lastname@example.com, and Professor Mario Seccareccia at: email@example.com.
Thank you for your support.
An Open-Letter to:
The Honourable Kerry-Lynne D. Findlay, P.C., Q.C.
Minister of National Revenue
c.c.: Kathy Hawara, Director General of the Charities Division, Canada Revenue Agency
Dear Minister Findlay,
Recently, we were informed through reports in a number of newspapers that the Canada Revenue Agency (CRA) has undertaken an audit of the Canadian Centre for Policy Alternatives (CCPA) on the grounds that it allegedly engages in politically partisan, biased and one-sided research activity.
While we understand the need to prevent abuses of the charitable status, we are rather perplexed at CRA's decision to perform the audit on this basis. The CCPA is an internationally-recognized and respected research centre, built on a solid tradition of critical analysis. Indeed, the CCPA plays a vital role by supplying much needed reflection on a number of policies, which it has always done in a fair and unbiased way, and which respects the fundamental tools of sound research. They have produced much-needed research on many disparate topics, such as on income and wealth distribution, the hidden government support of the Canadian banking sector during the financial crisis, and an analysis of alternative federal fiscal policy implementation annually. Since these various research studies are academically all of very high quality, you can therefore imagine how this news took us by surprise.
By undertaking this audit, we feel that CRA fails to understand the nature of what academic research is all about. Research begins from a series of questions and observations, and, from there, it proceeds, following a set of guidelines, to infer possible answers. In this sense, it contests. All research in fact is critical, by its very definition: it tests hypotheses, seeks answers, and must be allowed to find these answers wherever it can.
But critical policy analysis does not equate with political activism, nor is it "biased" or "one-sided", as CRA has claimed. Researchers explore specific questions of interest, and then present the results of their research. Reaching a conclusion is not the same as bias. To illustrate, a CCPA researcher explored the issue of what would be the appropriate exchange rate regime for Canada and then concluded that a floating exchange rate was desirable to alternative types of exchange rate mechanisms because the former allowed the public authorities to conduct independent macroeconomic policies. The fact that this conclusion turned out to be similar to the policy view of the Bank of Canada does not make the CCPA researcher any more political than if the researcher would have produced that same research independently within his/her respective university.
The CCPA is not a political organization, nor does it engage in political or partisan activities. The fact that it has criticized government policy on a number of issues does not make it a partisan organization promoting a narrow agenda. Rather, it is engaging in serious, unbiased academic research. It may reach a different set of conclusions from those of the government, but then, this is allowed in a free-thinking, democratic country. On the contrary, we would argue, that such dissent should be encouraged and not stifled by such actions of the CRA.
Indeed, if there is bias, the bias seems to be mostly in the CRA's decision to audit the CCPA and apparently no other think tanks, whose policy conclusions are friendlier toward current government policies. We are not aware of any audits being launched regarding "bias" at conservative think tanks like the Fraser Institute; some have publicly confirmed that they are not being audited (including the Macdonald-Laurier Institute and the C.D. Howe Institute). We are therefore left with the conclusion that the decision to audit the CCPA is politically motivated to intimidate and silence its criticism of your government's policies.
We therefore strongly urge the CRA to put a moratorium on its audits of think tanks, until such time as a truly neutral criteria and auditing process are implemented to ensure neutrality and fairness, and to ensure that the audit process does not silence dissenting voices. Periodic audit should be conducted in a fair, transparent, and even-handed fashion across all the various think-tanks that claim charitable status in Canada, with a focus on financial management and integrity (not on the content of the research being conducted). Why single out only one such research centre that happens to be more critical of government policy? Instead of trying to muzzle and impede sound and legitimate research, it is now time for you to try to promote more effectively the public good in the form of sound critical research for which Canadian researchers are respected internationally.
Signed (alphabetically by 422 Canadian academics in post-secondary institutions):
1. Teresa Abbruzzese, Social Science, York University
2. Abdella Abdou, Economics, Brandon University
3. Frances Abele, School of Public Policy and Administration, Carleton University
4. Zelda Abramson, Sociology, Acadia University
5. Roy J. Adams, Industrial Relations, University of Saskatchewan/Human Rights, McMaster University
6. Laurie E. Adkin, Political Science and Environmental Studies, University of Alberta
7. Haroon Akram-Lodhi, International Development Studies, Trent University
8. Greg Albo, Political Science, York University
9. Pilar Riaño Alcalá, School of Social Work, University of British Columbia
10. David Alper, École de service social, Université de Saint-Boniface
11. Sharon Alward, School of Art, University of Manitoba
12. Barb Anderson, School of Nutrition and Dietetics, Acadia University
13. Caroline Andrew, Political Studies, University of Ottawa
14. Edward Andrew, Department of Political Science (Emeritus), University of Toronto
15. Ian Angus, Humanities, Simon Fraser University
16. Joel Anthony, Biostatistics, University of Waterloo
17. Kelly Anthony, Applied Health Sciences, University of Waterloo
18. Maria Fernanda Arentsen, Littérature/langue espagnole, Université de Saint‑Boniface
19. Hugh Armstrong, Social Work, Political Economy, and Sociology, Carleton University
20. Michael Asch, Anthropology, University of Alberta
21. Tildiz Atasoy, Sociology and Anthropology, Simon Fraser University
22. Patricia Ballamingie, Geography & Environmental Studies, Carleton University
23. Mike Ballard, Information and Communications Technology Department
Algonquin College
24. Fletcher Baragar, Economics, University of Manitoba
25. Chris Barrington-Leigh, Institute for Health and Social Policy, McGill University
26. Virginia A. Bartley, Faculty of Law, Queen's University
27. Tuna Baskoy, Politics and Public Administration, Ryerson University
28. Milford Bateman, International Development Studies, St Mary's University
29. Sara Beam, History, University of Victoria
30. Raluca Bejan, Faculty of Social Work, University of Toronto
31. David Bell, Law, University of New Brunswick
32. Nicole S. Berry, Faculty of Health Sciences, Simon Fraser University
33. Jacqueline Best, École d'études politiques, Université d'Ottawa
34. Manfred Bienefeld, School of Public Policy and Administration, Carleton University
35. Greg Bird, Sociology, Wilfrid Laurier University
36. Karen Bird, Political Science, McMaster University
37. Anne-Emanuelle Birn, School of Public Health, University of Toronto
38. Andrew Biro, Politics, Acadia University
39. Katherine Bischoping, Sociology, York University
40. David Black, Political Science, Dalhousie University
41. Gary Bloch, Faculty of Medicine, University of Toronto
42. Gregory Blue, Department of History, University of Victoria
43. John Bogardus, Sociology and Anthropology, Simon Fraser University
44. Marleny Bonnycastle, Social Work, University of Manitoba
45. Karine Côté-Boucher, Criminologie, Université de Montréal
46. Hassan Bougrine, Economics, Laurentian University
47. Philippe Bourdin, French Studies, Glendon College, York University
48. Dominique Bourque, Women's Studies Institute, University of Ottawa
49. Susan Boyd, Faculty of Human and Social Development, University of Victoria
50. Susan Braedley, School of Social Work, Carleton University
51. Linda Briskin, Social Science/School of Women's Studies, York University
52. Darlene A. Brodeur, Psychology, Acadia University
53. Andrew Brook, Chancellor's Professor of Philosophy and Cognitive Science, Carleton University
54. Neil Brooks, Osgoode Hall Law School
55. Enda Brophy, School of Communication, Simon Fraser University
56. Leslie Brown, Dept of Sociology and Anthropology, Mount Saint Vincent University
57. Christine Bruckert, Criminology, University of Ottawa
58. Robert Brym, Sociology, University of Toronto
59. Jerry Buckland, Dean Menno Simons College, Affiliated with University of Winnipeg
60. Michael Byers, Political Science, University of British Columbia
61. James Cairns, Society, Culture, and Environment, Wilfrid Laurier University
62. John Calvert, Health Sciences, Simon Fraser University
63. Barbara Cameron, Political Science, York University
64. John Cameron, International Development Studies, Dalhousie University
65. Maxwell A. Cameron, Political Science, University of British Columbia
66. David Camfield, Labour Studies and Sociology, University of Manitoba
67. Canadian Anthropology Society
68. Eduardo Canel, Social Science, York University
69. Liesel Carlsson, School of Nutrition and Dietetics, Acadia University
70. R. Nicholas Carleton, Psychology, University of Regina
71. William K. Carroll, Sociology, University of Victoria
72. Angela V. Carter, Political Science, University of Waterloo
73. Adrienne Chambon, Social Work, University of Toronto
74. Chris Chapman, School of Social Work, York University
75. Jean Chapman, Simone de Beauvoir Institute, Concordia University
76. Lanyan Chen, Social Welfare and Social Development, Nipissing University
77. Robert Chernomas, Economics, University of Manitoba
78. Christopher Churchill, History and Global Studies, Alfred University, Alfred, NY
79. Stephen Clarkson, Political Science, University of Toronto
80. Andrew Clement, Faculty of Information, University of Toronto
81. Michael Clow, Sociology, St. Thomas University
82. Nicole S. Cohen, Faculty of Information, University of Toronto
83. William D. Coleman, Political Science, University of Waterloo
84. Ken Collier, Social Work and Integrated Studies, University of Regina and Athabasca University
85. Thomas Collombat, sciences sociales, Université du Québec en Outaouais
86. Elizabeth Comack, Sociology, University of Manitoba
87. Bruce Connell, Linguistics and Language Studies, Glendon College, York University
88. John Conway, Sociology and Social Studies, University of Regina
89. Natalie Coulter, Communication Studies, York University
90. Paul Craven, Social Science, York University
91. Marcela Cristi, Sociology, Wilfrid Laurier University
92. María Cristina Cuervo, Spanish and Linguistics, University of Toronto
93. Dara Culhane, Sociology and Anthropology, Simon Fraser University
94. Frank Cunningham, Political Science and Philosophy, University of Toronto
95. Richard Cunningham, English and Theatre, Acadia University
96. Raymond F. Currie, Sociology, University of Manitoba
97. Lykke de la Cour, Social Science, York University
98. Darrell Crooks, School of Engineering, Acadia University
99. Charles Daviau, Northern Development and Labour Studies, Laurentian University
100. Henry Davis, Linguistics, University of British Columbia
101. Amber Dean, English and Cultural Studies, McMaster University
102. Maneesha Deckha, Faculty of Law, University of Victoria
103. Jessica Dempsey, School of Environmental Studies, University of Victoria
104. Deborah Dergousoff, Sociology/Anthropology, Simon Fraser University
105. Radhika Desai, Political Studies, University of Manitoba
106. Annette Desmarais, Sociology, University of Manitoba
107. Mitch Diamantopoulos, School of Journalism, University of Regina
108. Harry Diaz, Sociology and Social Studies, University of Regina
109. Michael Dickman, Department of Experimental Sciences, Université de Saint-Boniface
110. Robert Dimand, Economics, Brock University
111. D. Dimitrova, Sociology, York University
112. Alexandra Dobrowolsky, Political Science, Saint Mary's University
113. Joe Dolecki, Economics, Brandon University
114. C. J. Doran, Social Science, University of New Brunswick
115. Katie Dorman, Resident Physician, University of Toronto
116. Sara Dorow, Sociology, University of Alberta
117. Hadi Dowlatabadi, Institute for Resources Environment & Sustainability, University of British Columbia
118. Paul Downes, Department of English, University of Toronto
119. Daniel Drache, Political Science, York University
120. Sabine Dreher, International Studies, Glendon College, York University
121. Lindsay DuBois, Sociology and Social Anthropology, Dalhousie University
122. David F. Duke, History and Classics, Acadia University
123. Mathieu Dufour, John Jay College of Criminal Justice, City University of New York
124. Peter Dungan, Rotman School of Management, University of Toronto
125. Emily Eaton, Geography, University of Regina
126. Patricia W. Elliott, School of Journalism, University of Regina
127. Christo El Morr, Faculty of Health, York University
128. Kimberly Ellis-Hale, Sociology,Wilfrid Laurier University
129. Peter R. Elson, School of Public Administration, University of Victoria
130. John Eustace, English and Theatre, Acadia University
131. Bryan Evans, Politics and Public Administration, Ryerson University
132. Matthew Farish, Geography, University of Toronto
133. Leesa Fawcett, Faculty of Environmental Studies, York University
134. Sue Ferguson, Digital Media and Journalism, Wilfrid Laurier University
135. Mark Fettes, Faculty of Education, Simon Fraser University
136. Maria Figueredo, Languages, Literatures and Linguistics, York University
137. Len Findlay, English, University of Saskatchewan
138. Tammy Findlay, Political and Canadian Studies, Mount Saint Vincent University
139. Alvin Finkel, Department of History, Athabasca University
140. Liz Fitting, Sociology & Social Anthropology, Dalhousie University
141. Marco Fonseca, International Studies, York University
142. John W. Foster, Sociology, Carleton University
143. Karen Foster, Sustainable Rural Futures for Atlantic Canada, Dalhousie University
144. Ruth A. Frager, History, McMaster University
145. David Frank, History, University of New Brunswick
146. Lesley Frank, Sociology, Acadia University
147. Sid Frankel, Social Work, University of Manitoba
148. Myron J. Frankman, Economics, McGill University
149. Gail Fraser, Faculty of Environmental Studies,York University
150. Gavin Fridell, International Development Studies, Saint Mary's University
151. Tami J. Friedman, History, Brock University
152. Harriet Friedmann, Sociology, University of Toronto
153. Don Fuchs, Faculty of Social Work, University of Manitoba
154. Kathryn Furlong, Géographie, Université de Montréal
155. Lynda Gagné, School of Public Administration, University of Victoria
156. Marc-André Gagnon, School of Public Policy and Administration, Carleton University
157. Anca Gaston, School of Kinesiology, Western University
158. Jim Gerlach, Chemistry and Biochemistry, Wilfrid Laurier University
159. Lauren Gillingham, English, University of Ottawa
160. L. Good Gingrich, School of Social Work and Centre for Refugee Studies, York University
161. Maya K. Gislason, Faculty of Health Sciences, Simon Fraser University
162. Rebecca Godderis, Society, Culture and Environment & Health Studies, Wilfrid Laurier University
163. Luin Goldring, Sociology, York University
164. Nicole Gombay, Géographie, Université de Montréal
165. Todd Gordon, Society, Culture and Environment, Laurier University
166. Rachel Gorman, School of Health Policy and Management, York University
167. Gwendolyn Gosek, Faculty of Social Work, University of Manitoba
168. Matheus Grasselli, The Fields Institute, University of Toronto
169. Donald Grayston, Humanities, Simon Fraser University
170. Hirsch Greenberg, Justice Studies, University of Regina
171. Marjorie Griffin Cohen, Political Economy, Simon Fraser University
172. Ricardo Grinspun, Economics, York University
173. Julie Guard, History and Labour Studies, University of Manitoba
174. Satya Dev Gupta, Economics, St. Thomas University
175. Robert Hackett, School of Communication, Simon Fraser University
176. Ratiba Hadj-Moussa, Women's Studies, York University
177. Judy Haiven, Management, Saint Mary's University
178. Donalda Halabuza, Social Work, University of Regina
179. Derek Hall, Political Science/Balsillie School of International Affairs, Wilfrid Laurier University
180. Peter Hall, Urban Studies, Simon Fraser University
181. Sandrine Hallion, Etudes françaises, Université de Saint-Boniface
182. Deana Halonen, Faculty of Social Work, University of Manitoba
183. Paul A. Hamel, Faculty of Medicine, University of Toronto
184. Roberta Hamilton, Sociology, Queen's University
185. Trevor Hancock, School of Public Health and Social Policy, University of Victoria
186. Roy Hanes, Social Work, Carleton University
187. Frédéric Hanin, Industrial Relations, Université Laval
188. Bob Hanke, Communication Studies and Humanities, York University
189. Stacey Hannem, Criminology, Wilfrid Laurier University
190. Lori Hanson, College of Medicine, University of Saskatchewan
191. James Hare, Biological Sciences, University of Manitoba
192. Kathryn Harrison, Political Science, University of British Columbia
193. Trevor Harrison, Sociology, University of Lethbridge
194. Matthew Hayes, Sociology, St. Thomas University
195. David Heap, Department of Linguistics & French, University of Western Ontario
196. Terry Heaps, Economics, Simon Fraser University
197. Tuula Heinonen, Faculty of Social Work, University of Manitoba
198. Jane Helleiner, Department of Sociology, Brock University
199. Eric Helleiner, Political Science, University of Waterloo
200. Judith Adler Hellman, Political and Social Science, York University
201. Stephen Hellman, Political Science, York University
202. Dawn Hemingway, School of Social Work, University of Northern British Columbia
203. Roderick Hill, Economics, University of New Brunswick
204. John Holmes, Geography, Queen's University
205. Jennie Hornosty, Sociology, University of New Brunswick
206. Ian Hudson, Economics, University of Manitoba
207. Mark Hudson, Sociology, University of Manitoba
208. Peter Hudson, Faculty of Social Work, University of Manitoba
209. Judy Hughes, Faculty of Social Work, University of Manitoba
210. Sally Humphries, International Development Studies, University of Guelph
211. Thaddeus Hwong, Liberal Arts & Professional Studies, York University
212. Suzan Ilcan, Sociology, University of Waterloo, and Balsillie School of International Affairs
213. Shin Imai, Osgoode Hall Law School
214. Gustavo Indart, Economics, University of Toronto
215. Christopher Innes, Performance & Culture, York University
216. Andrew Jackson, Political Science, York University
217. Matt James, Political Science, University of Victoria
218. Jane Jenson, science politique, Université de Montréal
219. Rebecca Johnson, Faculty of Law, University of Victoria
220. Miriam Jones, Humanities & Languages, University of New Brunswick
221. Christine Jourdan, President, Canadian Anthropology Society, Department of Anthropology, Concordia University
222. Eric Kam, Economics, Ryerson University
223. Burc Kayahan, Economics, Acadia University
224. Dip Kapoor, International Education, University of Alberta
225. LLan Kapoor, Faculty of Environmental Studies, York University
226. Rita Kaur Dhamoon, Political Science, University of Victoria
227. Larry Kazdan, Accounting, British Columbia Institute of Technology
228. Paul Keen, Faculty of Graduate and Postdoctoral Affairs, Carleton University
229. Samantha King, School of Kinesiology & Health Studies, Queen's University
230. Paul Kingston, Centre for Critical Development Studies, University of Toronto
231. Stefan Kipfer, Faculty of Environmental Studies, York University
232. Sara FL Kirk, Canada Research Chair, School of Health and Human Performance, Dalhousie University
233. Mustafa Koc, Sociology, Ryerson University
234. Lisa Kowalchuk, Sociology and Anthropology, University of Guelph
235. Kirsten Kozolanka, Journalism and Communication, Carleton University
236. Robert B. Kristofferson, Society, Culture & Environment/History, Wilfred Laurier University
237. Rod Kueneman, Sociology, University of Manitoba
238. Peter Kulchyski, Native Studies, University of Manitoba
239. Dany Lacombe, Sociology and Anthropology, Simon Fraser University
240. Rollie LaHaye, Arts Faculty – Justice Studies, Mount Royal University
241. Rosanna Langer, Law and Justice, Laurentian University
242. David Langille, Social Sciences, York University
243. Ganaele Langlois, Communication Studies, York University
244. Thierry Lapointe, Political Science, Université de St-Boniface
245. Marc Lavoie, Economics, University of Ottawa
246. James Lawson, Political Science, University of Victoria
247. David Leadbeater, Economics, Laurentian University
248. James L. Leake, Faculty of Dentistry (emeritus), University of Toronto
249. Michael A. Lebowitz, Economics, Simon Fraser University
250. Joelle Leclaire, Economics, SUNY Buffalo State, NY
251. Paul Leduc Browne, Sciences sociales, Université du Québec en Outaouais
252. Iara Lessa, Social Work, Ryerson University (Emirita)
253. Leah Levac, Political Science and Community Engaged Scholarship, University of Guelph
254. Jacqueline Levitin, School for the Contemporary Arts (Film)/Gender, Simon Fraser University
255. Joel Lexchin, School of Health Policy and Management, York University
256. Myra Leyden, Joint Centre for Bioethics, University of Toronto
257. Ernie Lightman, Social Policy, University of Toronto
258. Abby Lippman, Epidemiology, Biostatistics, and Occupational Health, McGill University
259. Carla Lipsig-Mummé, Social Science, York University
260. Margaret Little, Political Studies, Queens University
261. Cynthia Loch-Drake, Schulich School of Business, York University
262. Carlos David Londoño Sulkin, Anthropology, University of Regina
263. José López, Sociology and Anthropology, University of Ottawa
264. John Loxley, Economics, University of Manitoba
265. Lucy Luccisano, Sociology, Wilfrid Laurier University
266. Colleen Lundy, School of Social Work, Carleton University
267. Eleanor MacDonald, Political Studies, Queen's University
268. Gayle MacDonald, Sociology, St. Thomas University
269. Heidi MacDonald, History, University of Lethbridge
270. Ian MacDonald, École de relations industrielles, Université de Montréal
271. Kenneth Ian MacDonald, Human Geography and City Studies, University of Toronto
272. Laura Macdonald, Institute of Political Economy Carleton University
273. Karen MacKinnon, School of Nursing, University of Victoria
274. Shauna MacKinnon, Urban and Inner City Studies, University of Winnipeg
275. Brian MacLean, Economics, Laurentian University
276. André Magnan, Sociology and Social Studies, University of Regina
277. Warren Magnusson, Political Science, University of Victoria
278. Terrill Maguire, Faculty Fine Arts, Dance, York University
279. Rianne Mahon, Political Science, Wilfrid Laurier University
280. Paul Makdissi, Economics, University of Ottawa
281. Guida Man, Liberal Arts and Professional Studies, York University
282. David Mandel, Science politique, Université du Québec à Montréal
283. Geoff Mann, Geography, Simon Fraser University
284. Allan Manson, Faculty of Law, Queen's University
285. Lynne Marks, Department of History, University of Victoria
286. Michael Markwick, School of Communication, Capilano University
287. Alina Marquez, Social Science, York University
288. Greg Marquis, History and Politics, University of New Brunswick
289. Fiona S. Martin, Department of Sociology and Social Anthropology, Dalhousie University
290. Marie-Josée Massicotte, École d'études politiques, Université d'Ottawa
291. Dominique Masson, Institute of Feminist and Gender Studies, University of Ottawa
292. María Inés Matínez, French, Spanish and Italian, University of Manitoba
293. Atsuko Matsuoka, School of Social Work, York University
294. Lisa Matthewson, Linguistics, University of British Columbia
295. Stephen McBride, Political Science, McMaster University
296. Margaret McCallum, Faculty of Law, University of New Brunswick
297. Dianne McCormack, Applied Science and Engineering, University of Brunswick
298. Joan McFarland, Economics/Women's and Gender Studies, St. Thomas University
299. Elizabeth W. McGahan, History and Politics, University of New Brunswick
300. Martha McGinnis-Archibald, Linguistics, University of Victoria
301. Kim McGrail, School of Population and Public Health, University of British Columbia
302. Susan McGrath, School of Social Work & Centre for Refugee Studies, York University
303. Tom McIntosh, Politics and International Studies, University of Regina
304. Sheila McIntyre, Faculty of Law, University of Ottawa
305. Brad McKenzie, Faculty of Social Work, University of Manitoba
306. Marcia McKenzie, College of Education, University of Saskatchewan
307. J.J. McMurtry, Social Science, York University
308. David McNally, Political Science, York University
309. James McNinch, Faculty of Education, University of Regina
310. Rick Mehta, Psychology, Acadia University
311. Ryan Meili, College of Medicine, University of Saskatchewan
312. Merouan Mekouar, International Development Studies, York University
313. Margie Mendell, School of Community and Public Affairs, Concordia University
314. Franklin Mendivil, Mathematics and Statistics, Acadia University
315. Adèle Mercier, Philosophy, Queen's University
316. Karen Messing, Sciences Biologiques, Université du Québec à Montréal
317. Michael M'Gonigle, Faculty of Law, University of Victoria
318. Tara H. Milbrandt, Sociology, University of Alberta
319. Lisa Mills, Public Policy and Administration, Carleton University
320. Suzanne Mills, School of Labour Studies and Geography and Earth Sciences, McMaster University
321. Barbara A. Mitchell, Sociology & Gerontology, Simon Fraser University
322. Douglas Moggach, Political Studies and Philosophy, University of Ottawa
323. Faisal Moola, Faculty of Forestry, University of Toronto
324. Haideh Moghissi, Equity Studies, York University
325. Esteve Morera, Philosophy and Political Science, York University
326. Dawn Morgan, English, St. Thomas University
327. Marina Morrow, Centre for the Study of Gender, Social Inequities and Mental Health, Simon Fraser University
328. Jeremy Mouat, Chair, Social Sciences, University Alberta
329. James P. Mulvale, Faculty of Social Work, University of Manitoba
330. Allan Moscovitch, Social Work, Carleton University
331. Tiffany Muller Myrdahl, Gender, Sexuality and Women's Studies, Simon Fraser University
332. Jan O. Murie, Biological Sciences, University of Alberta
333. Brenda L. Murphy, Faculty of Liberal Arts, Society, Culture and Environment, Wilfred Laurier University
334. Laura J. Murray, English and Cultural Studies, Queen's University
335. Tony Myatt, Economics, University of New Brunswick
336. Eric Mykhalovskiy, Sociology, York University
337. John Myles, Sociology and School of Public Policy and Governance, University of Toronto
338. Eric Newstadt, Politics, Acadia University
339. Winnie Ng, Social Justice and Democracy, Ryerson University
340. Michael Nijhawan, Sociology, York University
341. Kendra Nixon, Faculty of Social Work, University of Manitoba
342. Liisa L. North, Political Science, York University
343. Richard W. Nutter, Social Work, University of Calgary
344. Nicole O'Byrne, Faculty of Law, University of New Brunswick
345. Anne O'Connell, School of Social Work, York University
346. Paul Orlowski, Educational Foundations, University of Saskatchewan
347. Lars Osberg, Economics, Dalhousie University
348. Gerardo Otero, Sociology and Anthropology, Simon Fraser University
349. Robin Ostow, Sociology, Wilfrid Laurier University
350. Karen Palmer, Faculty of Health Sciences, Simon Fraser University
351. Leo Panitch, Political Science, York University
352. Sylvie Paquerot, Études politiques, Université d'Ottawa
353. Pierre Paquette, Gestion et Économie, Collège militaire royal du Canada
354. Daniel J. Paré, School of Information Studies, University of Ottawa
355. Kate Parizeau, Geography, University of Guelph
356. Corinne Pastoret, Economics, Laurentian University
357. Viviana Patroni, Social Science, York University
358. Justin Paulson, Sociology and Anthropology, Carleton University
359. Christopher Pavsek, School for the Contemporary Arts, Simon Fraser University
360. Mark Peacock, Social Science, York University
361. Hélène Pellerin , École d'études politiques, Université d'Ottawa
362. Patricia E. Perkins, Environmental Studies, York University
363. Adele Perry, History, University of Manitoba.
364. Nalini Persram, Social Science, York University
365. Tracey Peter, Department of Sociology, University of Manitoba
366. Paul Peters, Sociology and Economics, University of New Brunswick
367. Stephen Phillips, Political Science, Langara College
368. Toni Pickard, Faculty of Law, Queen's University
369. Kelly Pike, Work and Labour Studies, York University
370. Robert Pitter, School of Kinesiology, Acadia University
371. Kari Polanyi Levitt, Economics, McGill University
372. James N. Porter, Sociology, York University
373. Garry Potter, Sociology, Wilfred Laurier University
374. Gillian Poulter, History and Classics, Acadia University
375. Stuart Poyntz, School of Communication, Simon Fraser University
376. Elaine Power, School of Kinesiology and Health Studies, Queen's University
377. Susan Preston, School of Social Work, Ryerson University
378. Craig Proulx, Anthropology, St. Thomas University
379. Vernon Provencal, History and Classics, Acadia University
380. Scott Prudham, Geography, University of Toronto
381. Norene Pupo, Sociology, York University
382. Jack Quarter, OISE, University of Toronto
383. Martha Radice, Social Anthropology, Dalhousie University
384. Reza Rahbari, Sociology and Equity Studies, York University
385. Momin Rahman, Sociology, Trent University
386. Saeed Rahnema, Political Science and Equity Studies, York University
387. Indhu Rajagopal, Social Science, York University
388. Daniel Rainham, Chair in Sustainability and Environmental Health, Environmental Science, Dalhousie University
389. Dennis Raphael, Health Policy and Management, York University
390. Geoff Read, History, Huron University College, University of Western Ontario
391. Leslie Regan Shade, Faculty of Information, University of Toronto
392. Darryl Reed, Social Science, York University
393. Ester Reiter, Liberal Arts, York University
394. Graham Riches, School of Social Work, University of British Columbia
395. Louis-Philippe Rochon, Economics, Laurentian University
396. Cathy Rocke, Faculty of Social Work, University of Manitoba
397. Sanda Rodgers, Faculty of Law, University of Ottawa
398. Cristina Rojas, Political Science, Carleton University
399. Herman Rosenfeld, Political Science and Labour Studies, York University and McMaster University
400. Jeffrey S. Rosenthal, Statistics, University of Toronto
401. Stephanie Ross, Social Science, York University
402. Abraham Rotstein, Economics, University of Toronto
403. Christian Rouillard, Études politiques, Université d'Ottawa
404. James K. Rowe, School of Environmental Studies, University of Victoria
405. Ranjan Roy, Clinical Health Psychology, Faculty of Medicine, University of Manitoba
406. Nicholas Ruddick, English, University of Regina
407. Ellen Russell, Digital Media and Journalism, Society, Culture, and Environment, Wilfred Laurier University
408. Blair Rutherford, Sociology and Anthropology, Carleton University
409. Phil Ryan, School of Public Policy and Administration, Carleton University
410. Sherida Ryan, Social Economy Centre, University of Toronto
411. Kim Rygiel, Political Science and the Balsillie School of International Affairs, Wilfrid Laurier University
412. Eric W. Sager, History, University of Victoria
413. Miguel Sanchez, Faculty of Social Work, University of Regina
414. Mark Sandilands, Psychology, University of Lethbridge
415. Rosa Sarabia, Department of Spanish and Portuguese, University of Toronto
416. Anna Saroli, Hispanic Studies, Languages and Literatures, Acadia University
417. Sébastien Savard, School of Social Work, University of Ottawa
418. Dana Sawchuk, Sociology, Wilfrid Laurier University
419. Todd Scarth, History and Global Political Economy, University of Manitoba
420. Melissa Schaefer, School of Health and Human Services, Camosun College
421. Rita Schreiber, School of Nursing, University of Victoria
422. Rebecca Schein, Institute of Interdisciplinary Studies (Human Rights), Carlton University
423. Kelly Scott, Social Work, University of Manitoba
424. Robert Seale, English and Theatre, Acadia University
425. Alan Sears, Sociology, Ryerson University
426. Mario Seccareccia, Economics, University of Ottawa
427. Andrew Secord, Economics, St. Thomas University
428. David Seljak, Religious Studies, University of Waterloo
429. James Sentence, Economics, University of Prince Edward Island
430. Ardeshir Sepehri, Economics, University of Manitoba
431. John Serieux, Economics, University of Manitoba
432. Yasmine Shamsie, Political Science, Wilfrid Laurier University
433. Ketan Shankerass, Psychology, Wilfrid Laurier University
434. Karena Shaw, School of Environmental Studies, University of Victoria
435. John Shields, Politics and Public Administration, Ryerson University
436. Tyler Shipley, Department of International Studies, York University
437. David Shugarman, Political Science, York University
438. Janet Siltanen, Sociology and Political Economy, Carleton University
439. Daniel L. Silver, Jodrey School of Computer Science, Acadia University
440. Jim Silver, Urban and Inner-City Studies, University of Winnipeg
441. Derek Simon, Religious Studies, St. Thomas University
442. John Simoulidis, Business and Society Program, York University
443. Harry Smaller, Faculty of Education, York University
444. Charles Smith, Political Studies, St. Thomas More College, University of Saskatchewan
445. Patrick Smith, Political Science, Simon Fraser University
446. John Smithin, Economics and Schulich School of Business, York University
447. Ian Skelton, Department of City Planning, University of Manitoba
448. David Skinner, Communication Studies, York University
449. Russell C. Smandych, Sociology, University of Manitoba
450. Adam Sneyd, Department of Political Science University of Guelph
451. Denise L. Spitzer, Institute of Women's Studies and the Institute of Population Health, University of Ottawa
452. Marc Spooner, Faculty of Education, University of Regina
453. Brenda Spotton Visano, School of Public Policy & Administration, and Economics, York University
454. Susan Spronk, School of International Development and Global Studies, University of Ottawa
455. Kendra Strauss, Department of Geography, Simon Fraser University
456. Jennifer A. Stephen, History, York University
457. Pierre Stevens , Department of Mathematics and Statistics, Dalhousie University
458. Erin Steuter, Sociology, Mount Allison University
459. Andrew Stevens, Faculty of Business Administration, University of Regina
460. Jordan Stanger-Ross, History, University of Victoria
461. Donald Swartz, School of Public Policy and Administration, Carleton University
462. Karen Swift, Social Work, York University
463. Almos Tassonyi, Adjunct Professor of Economics, Ryerson University
464. Luc Thériault, Sociology, University of New Brunswick
465. Hugh Thomas, Mathematics, University of New Brunswick
466. Mark Thomas, Sociology, York University
467. Laura A. Thompson, School of Education, Acadia University
468. Sonia R. Thon, Languages and Literatures, Acadia University
469. Edward D. Tymchatyn, Mathematics and Statistics, University of Saskatchewan
470. Suzanne Urbanczyk, Linguistics, University of Victoria
471. Peyman Vahabzadeh, Sociology, University of Victoria
472. Brian VanBlarcom, Economics, Acadia University
473. Anil Varughese, Public Policy and Administration, Carleton University
474. Henry Veltmeyer, Sociology and International Development Studies, Saint Mary's University
475. J.I. Vorst, Economics, University of Manitoba
476. R.B.J. Walker, Political Science, University of Victoria
477. Glenda Wall, Sociology, Wilfrid Laurier University
478. Bruce Wallace, School of Social Work, University of Victoria
479. Margaret Walton-Roberts, School of International Policy and Governance, Balsillie School of International Affairs
480. Rebecca Warburton, School of Public Administration, University of Victoria
481. Rennie Warburton, Sociology, University of Victoria
482. Rosemary Warskett, Law & Legal Studies, Carleton University.
483. Ailsa M. Watkinson, Faculty of Social Work, University of Regina
484. C.A. Watt, History, St. Thomas University
485. David Welch, École de service social, Université d'Ottawa
486. Donald Wells, School of Labour Studies, McMaster University
487. Emma Whelan, Sociology and Anthropology, Dalhousie University
488. Judy White, Faculty of Social Work, University of Regina
489. Elizabeth Whitmore, School of Social Work, Carleton University
490. Melanie Wiber, Anthropology, University of New Brunswick
491. Sarah Marie Wiebe, Political Science, University of Victoria
492. Carol Williams, Women and Gender Studies, University of Lethbridge
493. Patricia Williams, Applied Human Nutrition, Mount Saint Vincent University
494. Janice Williamson, English & Film Studies, University of Alberta
495. Sheena Wilson, Bilingual Writing Centre and English, University of Alberta
496. Rob Wilton, Geography & Earth Sciences, McMaster University
497. Mark Winfield, Environmental Studies, York University
498. Tony Winson, Sociology and Anthropology, University of Guelph
499. Heather Whiteside, Geography, University of British Columbia
500. Julia Wong, Sociology, University of Manitoba
501. Lesley Wood, Sociology, York University
502. Andrew Woolford, Sociology, University of Manitoba
503. Thom Workman, Political Science and International Development Studies, University of New Brunswick
504. Ken Wyman, School of Media Studies and Information Technology, Humber College
505. Feng Xu, Political Science, University of Victoria
506. Matthew G. Yeager, Sociology, King's University College at Western University
507. Hilary A.N. Young, Faculty of Law, University of New Brunswick
508. Margot Young, Faculty of Law, University of British Columbia
509. David Zakus, Department of Medicine, University of Alberta
510. Anna Zalik, Faculty of Environmental Studies, York University
511. Isik U. Zeytinoglu, Management and Industrial Relations, McMaster University
Should Welfare Recipients Try Harder to Find Work?
Posted by Nick Falvo under BC, Conservative government, employment, immigration, income, income support, Indigenous people, Job vacanices, labour market, migrant workers, poverty, skill shortages, social policy, temporary workers, unemployment, wages, workplace benefits.
September 11th, 2014
Comments: 2
This morning the Social Research and Demonstration Corporation released a new report about "motivational interviewing" for welfare recipients. The link to the full report is here, and the link to the executive summary is here.
Authored by Reuben Ford, Jenn Dixon, Shek-wai Hui, Isaac Kwakye and Danielle Patry, the study reports on a recent randomized controlled trial done on long-term recipients of social assistance in British Columbia. The research took place between September 2012 and March 2013. There were a total of 154 research participants; 76 of the individuals were in the "treatment group," while 78 were in the "control group."
Earlier this year, I was invited to be a discussant on the study at the Annual Conference of the Canadian Economics Association. Here are 10 things I think you should know about this report:
1. The "intervention" being studied was the Motivational Interviewing (MI) technique. MI is "a method of interacting with clients who are ambivalent about making change in their lives." It has "wide application in behavioural change: addictions, health, behaviour wellness, chronic disease management, and most recently in the employment field." For more on MI, see this web link.
2. Research participants were on welfare upon enrollment in the study. By "welfare," I mean last-resort social assistance. For most eligible residents in British Columbia, this is known as "income assistance (IA)." Upon being recruited for the study, most research participants were receiving approximately $1,000 per month to live on; this amount included "health supplements," as well as "general supplements" for such things as transportation. Research participants had also been identified by British Colombia's Ministry of Social Development as being "employment obligated," which means they were expected to be actively searching for paid employment. (For more on benefit levels available under social assistance programs administered by provincial and territorial governments, see this 2013 report. Readers should be mindful that, across Canada, there are separate social assistance systems for First Nations; a 2007 evaluation of the federally-administered "income assistance" program for First Nations can be found here.)
3. Research participants had been on welfare for at least one year at the study's outset. The rationale behind this recruitment strategy was to identify social assistance recipients who were most likely to be facing motivational challenges.
4. Most of the research participants reported health problems. According to the report, more than 70% of study participants "reported activity limitations that affected their ability to work." For example, just one-quarter of members of the treatment group reported that "their health was 'good' or 'very good…'" With this in mind, it's not entirely clear to me why British Columbia's Ministry of Social Development considers these individuals to be "employment obligated."
5. The "intervention" was provided by welfare officials (specifically, by Employment and Assistance Workers and case managers). Remarkably, each staff person received fewer than 70 hours of training before delivering the intervention (specifically, 60 hours of training in how to deliver MI and then nine hours of coaching as the intervention was being delivered). The training of staff was provided by Empowering Change Inc., a Canadian-based organization that (perhaps not surprisingly) specializes in training people on how to deliver MI. Members of the study's control group "received the range of services and treatment which they would typically receive" as long-term recipients of social assistance.
6. The results of this study suggest that Motivational Interviewing can be effective. By the end of the three-month study period, the difference in the respective employment rates of the treatment group and the control group was statistically significant. The precise size of the difference in the employment rate between the two groups was 7.8%. (For the research wonks: the level of statistical significance attained on this was 5%. Put differently, the likelihood that this finding occurred by chance is less than 5%.) This finding raises a question for me though: what would outcomes have been for members of the treatment group after 12 and 24 months respectively? Three months is not a long time.
7. Fewer than half of the members of the study's treatment group actually took in even one (hour-long) Motivational Interviewing session. Just 36 of the members of the study's 76 treatment group members chose to go through with a Motivational Interview. And only about one in five members of the treatment group took in more than one such session. Ergo: the success of the treatment group as a whole appears to have been carried by a minority of its membership. This suggests to me that the success of the treatment group is actually being understated; had every single member of the treatment group actually received the intervention (and not merely been offered it) I suspect the treatment group as a whole would have performed even more favourably compared with the control group.
8. The research was funded by Employment and Social Development Canada (ESDC). On the one hand, I suspect that most readers will not be surprised to learn that the federal government wants most people on welfare to 'look harder' for work. On the other hand, it may come as a surprise to some readers (especially those who remember the Harper government's decision to end the mandatory long-form census) that the federal government has funded research looking at what is effective in this regard.
9. The study took place at a time when, throughout Canada, there were considerably more unemployed persons than job vacancies. Across Canada there are roughly six unemployed persons for every job vacancy (a ratio that varies considerably across provinces). This raises an important question: in a country where the number of unemployed persons vastly outnumbers job vacancies, why does the federal government want to study the feasibility of long-term recipients of social assistance (many of whom have serious health problems) trying harder to find low-wage work? Some readers will remember a Toronto study conducted in 2001 that followed more than 800 individuals who had left welfare within the previous year. Fewer than half of those individuals "felt things had improved financially" for them since leaving social assistance; on the whole, after leaving social assistance, individuals "reported incomes at approximately 92% of Statistics Canada's 2001 Low Income Cut-Offs." (Further analysis of this Toronto study can be found here.)
10. This study took place at the same time that the federal government is aggressively bringing in more temporary migrant workers. As Jim Stanford has recently noted: "Migrant employment [in Canada] rose 140 per cent between 2005 and 2012." Further, "[o]ne in every five net new paid jobs created in Canada between 2007 and 2012 was filled by a migrant worker." This raises yet another question for me: why is the federal government interested in exploring how to encourage more welfare recipients to look harder for low-wage jobs while (simultaneously) 'importing' competition for many of those same jobs at an aggressive pace? Don't the two objectives work at cross purposes?
More on Secular Stagnation
Posted by Andrew Jackson under economic growth, fiscal policy, public infrastructure.
September 7th, 2014
Comments: 8
Here is the link to a piece I wrote for the Globe on line this week re an interesting new eBook on secular stagnation. I am struck by the fact that several eminently mainstream economists, mainly in the US but also Blanchard at the IMF, see a need for public investment to drive growth, given the fact that loose monetary policy alone is not up to the job and is fueling financial bubbles. This is a view which we do not often hear in Canada from mainstream academics and economists.. eg Chris Ragan's recent piece to the effect that we just have to tolerate slow growth and a weak job market.
The book also has an interesting discussion re technological progress and potential growth.
Terrible, Horrible, No Good, Very Bad Job Numbers
Posted by Angella MacEwen under employment, labour market, self-employed.
September 5th, 2014
Comments: 3
Today Statistics Canada released their first set of job numbers since the 'oops' of July 2014. And the news was dismal. The labour market shed 112,000 private sector positions, the largest single month drop in the private sector since, well, forever. Coming on the heels of a mistake is unfortunate, but you have to think that Statistics Canada was extra vigilant this month and checked everything up, down, backwards, and sideways.
Either way, month to month variations are far less meaningful than overall trends, so let's have a look at those, shall we?
Part-time work
Only workers over 55 have seen an increase in full time work compared to last August, and most of this is likely due to demographic change. Among core age workers there were fewer full-time jobs and more part-time jobs. Young workers traded 3,000 full-time jobs for less than a thousand part-time ones.
Temporary work
The picture is quite similar for temporary employment. Year over year, core age workers saw a drop in the number of permanent jobs, and an increase in temporary employment.
Young Workers
Young workers in particular have difficulty finding work when the labour market is slack. As do new Canadians. So it would follow that young workers who are also new Canadians have an even harder time. The graph below shows the unemployment rate for young workers as a 12 month moving average from January 2007.
At it's peak, the unemployment rate for young workers who had been landed immigrants for 5 -10 years almost hit 25%. While the unemployment rate for Canadian born young workers remains elevated over its pre-recession level, the trend seems to be gradually falling. On the other hand, the unemployment rate is rising for all three categories of new Canadian young workers.
Public / Private mix
Such a huge drop in private sector employment is a concern, since the labour market has been very heavily relying on private sector gains for the minimal job growth we have seen this year. And the huge spike in self-employment is also worrisome, as these jobs are more often precarious ones.
The good news is that this months drop in private sector employment and spike in self-employment didn't really change the overall mix when you look at the average over the past twelve months and compare this to the year before.
With far too few job vacancies, and record low proportions of unemployed workers receiving EI (especially in urban areas), the Canadian labour market is looking pretty depressing. I think there's going to be a lot to discuss at Unifor's upcoming Good Jobs Summit in Toronto.
Self-Employment Masks Job Loss
Posted by Erin Weir under labour market, self-employed, StatCan.
September 5th, 2014
Comments: 3
Statistics Canada reported today that employers cut the number of employees by 98,000 in August, which was largely masked by 87,000 more Canadians identifying themselves as self-employed. As a result, the headline level of "employment" – which includes self-employment – was little changed.
Self-employment ranges from high-income professionals to people eking out a living doing odd jobs. However, when a large increase in self-employment coincides with a large drop in positions paid by an employer, it begs the question of whether Canadians are becoming self-employed by choice or because jobs are not available. One also wonders how many survey respondents are simply more comfortable reporting themselves as self-employed rather than unemployed.
The headline numbers are weak and they would be disastrous but for the surge in self-reported self-employment. Policymakers must focus on creating jobs and ensuring adequate benefits for jobless workers.
Indigenous Workers in Canada
Posted by Angella MacEwen under aboriginal peoples, immigration, Indigenous people, industrial policy, inequality, labour market, recession, women, young workers.
September 4th, 2014
Comments: 1
Labour market data in Canada is easily available by sex, age, and region. We spend a great deal of time talking about these factors. More recently Statistics Canada made labour market data available on CANSIM by landed immigrant status, going back to 2006. This factor is less often included in most labour market analysis, and too few know that it is even available.
But if you want to know how racialized workers or Indigenous workers (First Nations, Métis, and Inuit peoples) are doing in the labour force you basically have to rely on the census … oh, wait. And on top of eliminating the census, the Harper government shut down the First Nations Statistical Institute.
So imagine my delight when a recent search on the issue turned up an article from the Centre for the Study of Living Standards about Indigenous employment that cited the Labour Force Survey as a source.
I should have already known that the Labour Force Survey asked an Aboriginal identity question, but I didn't. A quick call to Statistics Canada revealed that this data is freely available on request, but is limited to First Nations, Métis, and Inuit peoples living off reserve (since the LFS doesn't survey persons living on reserves).
I plan on doing a more thorough analysis, but I thought that I would post a few quick insights, and get the word out so that anyone who is interested can call and get the data for themselves.
Some of this data confirms things that we 'know', but having the hard numbers helps when we're calling for action. For example, unemployment is a HUGE issue for Indigenous young workers living off reserve, before, during, and after the recession. The unemployment rate reached a high of 22.5% in 2009, and was still 18% in 2013.
While I don't have the data to calculate underemployment, consider that underemployment rates seem to be about double unemployment rates for the general population. That suggests an underemployment rate of at least 36% for Indigenous young workers in 2013.
Unemployment rates for Indigenous workers are much higher than for non-Indigenous Canadian born workers, and are comparable to that of new Canadians.
As you can tell by the graph, the recession was more severe and lasted longer for Indigenous workers and new Canadians.
So whenever we're talking about labour market strategies and good jobs, it's important to keep in mind that for some workers there are systemic barriers that need to be addressed. Hopefully access to labour market data for Indigenous workers and new Canadians can be one way that we convey the need for action.
If you want to read more about Indigenous workers and the labour market in Canada the CSLS has a study using LFS data from 2007 – 2011, the Conference Board of Canada has a more employer driven study from 2012, and a 2011 paper in aboriginal policy studies by Friedel and Taylor analyses the colonial discourse in Indigenous labour market development policy in Northern Alberta.
Is Canada becoming a 'part-time' nation – the value of LMI
Posted by Angella MacEwen under labour market, part time work, temporary workers.
August 22nd, 2014
Comments: 3
Most of the jobs added to the Canadian labour market in 2014 were part-time – prompting headlines such as "Experts fret Canada becoming a nation of part-time workers".
Are we really a part-time nation? Well, 80% of workers in Canada are full-time, and a large majority of part-time workers choose to work part-time hours. So, no, we are not at the verge of some part-time workopolypse. But the labour market has been changing, driven partly by demographics (aging) and women entering the labour force.
Between 1976 and 2013, the number of core-age women working part-time jobs more than doubled – but the proportion of those women working part-time actually fell.
In the early 1980′s about one in four (25%) working women between 25 and 54 held a part-time job. By the mid-2000′s that number had dropped to one in five (20%). This means that as women entered the workforce in huge numbers, it became more common for them to hold full-time jobs as well.
A breakdown of part-time workers by age yields some interesting findings as well. When people think of part-time workers, they overwhelmingly picture pimply teenagers. But over time that has been less and less true.
In 1976, more than 30% of part-time workers were between 15 and 19 years of age. Now they make up less than 20% of the part time work force.
At the other end of the age spectrum, workers between 50 and 65 used to comprise only 10% of all part-time workers, and now make up more than 20%. As older workers need to stay in the labour force longer in order to supplement failing (or absent) pensions, this trend will likely increase.
All of this sparks a larger question: Why should we care about the number or proportion of part-time workers anyway?
Labour economists dissect the details of the monthly Labour Force Survey with the intensity of wild animals who have landed a fresh kill. We're hungry for data and answers, and search endlessly for the crosstab that will give us a fresh perspective on what's happening in people's lives across the country.
We care about the number of jobs, the quality of jobs, and the wages of jobs, because we care about the well-being of workers and their families. Under our current economic system, jobs are the main way that we distribute wealth – so it matters, a lot.
Very often the Labour Force Survey doesn't have the answers. But it gives us a place to start asking questions.
Revised LFS Numbers Don't Change the Big Picture
Posted by Jim Stanford under employment, labour market, StatCan.
August 15th, 2014
Comments: 3
What a rough week it's been over at Statistics Canada. It's a world-renowned statistical agency — though its lustre has been tarnished in recent years by budget cuts, cancelled data programs and series, and the nonsense of the Harper government's libertarian crusade against the long form census. The problems this week around its Labour Force Survey report for July will certainly contribute to the sense of entropy surrounding this important and valuable institution.
The biggest change in the numbers is that full-time employment is now estimated to have declined by about 20,000, instead of the original 60,000. Not exactly something to boast about. 60,000 part-time jobs were created (same as the original report). The unemployment rate is the same as the original report — and exactly the same as 18 months ago. The participation rate is unchanged from June: higher than in the original report, but still stuck at its lowest level since 2001.
I published a Globe and Mail commentary on Canada's stagnant labour market based in part on the original LFS report. Today's revised numbers do not materially change the argument I made there, which is that Canada's much-vaunted economic recovery was over-rated in the first place, and in fact ran out of steam a long time ago. There has been no sustained labour market progress for over three years. The employment rate is languishing just a hair above its level in June 2009 — the trough of the recession. That means job-creation since the trough of the recession has only just kept up with growth in the working-age population (ageing demographics is part of that story, too, on top of poor job-creation).
And the revised LFS numbers still confirm a growing contrast between the accelerating U.S. recovery and the stagnation and "serial disappointment" (Stepehn Poloz's catchy phrase) of Canada's trajectory. In the last year the U.S. economy created 2.3 million full-time jobs; Canada's created barely any (with the smaller-than-originally-reported loss of full-time employment in July, the year-over-year change is now positive but miniscule). The U.S. unemployment rate has dropped 1.7 points since January 2013. Canada's hasn't budged. The stark difference in macro policy stance between the two countries is clearly an important factor behind this take of two recoveries: American policy is emphasizing job-creation, and mobilizes conventional and unconventional levers to get there, while Canadian policy is dominated by orthodox concern with balancing the budget.
In short, I think Canada's relative underperormance since 2011 will become increasingly damaging to the Harper government, given how much it has invested in its reputation (deserved or not) as the "best economic managers."
Debunking Fraser Institute's latest contortion on taxes
Posted by Iglika Ivanova under economic literacy, Fraser Institute, taxation.
August 12th, 2014
Comments: 7
The Fraser Institute's annual Consumer Tax Index report generated some media buzz with its outlandish claims about just how much taxes have risen since 1961. Before you get worked up about this, consider that 1961 was over half a century ago, before the time of universal health care that we all benefit from, before the Canada Pension Plan and the Guaranteed Income Supplement that hugely reduced poverty for seniors, before the Canada Child Tax Benefit which is helping lower child poverty (though not enough!). Read more »
Declining pensions and bargaining power
Posted by Michal Rozworski under pensions.
August 5th, 2014
Comments: 2
[Cross-posted on my blog here.]
It's relatively common knowledge that employer-run pensions have been scaled back over the past few decades. I've decided to dig up some data on pensions for this post to see just how this has taken place in Canada, motivated by a recently-released analysis of US pension reform that finds contradictions in how US workers have come to take on more and more of the risk for their retirement income.
First, a bit of background. There are two main kinds of employer-administered pension funds: defined benefit (DB) plans – where retirees receive a set monthly income, or defined benefit – and defined contribution (DC) plans – where retirees receive a variable monthly income dependent on how much they proportionately contributed to the pension plan and how this money was invested. There are also completely individualized retirement savings plans such as the RRSP, but these are essentially individuals investment accounts given preferential tax treatment. However, the link between RRSPs and DC plans is that they generally place investment risk on workers themselves; if whatever financial instrument the money is invested in suffers, retirement income also suffers.
While some employers have eliminated pensions altogether, many have restructured their pension plans. Here's the Canadian data on registered pension plan membership, plotted as a percentage of employment:
Is r>g in Canada?
Posted by Andrew Jackson under inequality.
July 30th, 2014
Comments: none
Here is a little bit of rainy day economic doodling that may be of interest.
Piketty famously argues that there is a tendency for r – the rate of return on capital- to exceed g- the rate of growth of income. If r>g, wealth and income inequality will grow inexorably since ownership of capital and claims on income from capital are highly concentrated in a few hands.
Piketty's definition of capital is very broad, and boils down to wealth, including housing and financial assets.
I am not at all sure that house prices must or do increase at a faster rate than nominal incomes. Though they certainly have done so for the past decade or so, I would see this as unsustainable
As for the rate of return on financial assets, it does seem to be true that r has been greater than g for the past twenty years.
Nominal GDP growth (g) for 1989-1999 averaged 4.1%; for 2000-2008 it averaged 5.7%. (I leave out the recent recession, weak recovery,)
The risk-free return on capital proxied by the 10 year Government of Canada bond rate (January number) averaged 7.8% 1989 to 1999, due to high interest rates in the early to mid 1990s. However, it fell to an average of 4.8%, 2000-08. This was below the average nominal growth rate.
The average annual rate of return on capital employed (as equity and debt) in the business sector as reported by Statistics Canada was 6.2% from 1989 to 1999, rising to 6.9% from 2000 to 2008 – a rate of return comfortably greater than g.
(Data from Cansim 187-0002. I used Q1 numbers for each year)
Today, interest rates are very low compared to the nominal growth rate, but returns to capital in the business sector remain well above g.
So recent Canadian experience seems to broadly support the Piketty thesis.
Free Traders Panic Over German Challenge to Investor-State Dispute-Settlement
Posted by Jim Stanford under Europe, free trade, international trade.
July 30th, 2014
Comments: 4
In my many years documenting and critiquing the overblown claims of free trade proponents about the supposedly self-regulating efficiency-promoting mutually-benefiting effects of globalization, I've encountered some real doozies. Read more »
New Issue of Review of Keynesian Economics
Posted by Nick Falvo under economic thought, heterodox economics, macroeconomics, progressive economic strategies.
July 28th, 2014
Comments: none
A guest blog post from Louis-Philippe Rochon:
Dear friends and colleagues,
The new issue of the Review of Keynesian Economics (ROKE) is now out, and you can find it here. It features an interesting symposium on 'Steve Keen and his critics', and contains not only a paper by Steve Keen, but replies by Marc Lavoie, Tom Palley, and Brett Fiebiger. The Keen and Lavoie papers are available free for downloading.
Here is the full Table of Content. Enjoy.
Louis-Philippe Rochon
Founding Co-Editor
Mini-Symposium: Endogenous Money and Effective Demand
Endogenous Money and Effective Demand
Steve Keen
Keen and the "Walras-Schumpeter-Minsky Law": Financial Intermediation and
the Distribution of National Income also Matter to Macroeconomics
Brett Fiebiger
Effective demand, endogenous money, and debt: a Keynesian critique of Keen
and an alternative theoretical framework
Thomas I. Palley
A comment on endogenous money and aggregate demand: a revolution or a step
Marc Lavoie
The Political Economy of Public Investment and Public Finance: Challenges
for Social Democratic Policies
Jamee K. Moudud and Francisco Martinez- Hernandez
Political Contest, Policy Control, and Inequality in the United States
Mark Stelzner
A New Interpretation of Kaldor's First Growth Law for Open Developing
Penélope Pacheco-López and A. P. Thirlwall
Horizontalists, verticalists, and structuralists: the theory of endogenous
money reassessed', Review of Keynesian Economics, 1 (4), 406-424 (2013)
Thomas I. Palley
Book reviews
Obama's Economy: Recovery for the Few
by Jack Rasmus
London: Pluto Press 2012. 216 pp.
Reviewed by John Hall.
Central Banks and Financial Markets: The Declining Power of US MonetaryPolicy
By Hasan Cömert
Cheltenham: Edward Elgar Publishing 2013. 207pp.
Reviewed by Joshua Wojnilower
Against Utility-Based Economics: On a Life-Based Approach
By Anastosios Korkotsides
Oxon and New York: Routledge. 2013. 272 pp.
Reviewed by Philip Pilkington
EI Needs To Increase Access Not Lower Premiums
Posted by Angella MacEwen under Employment Insurance.
July 24th, 2014
Comments: 1
Erin does a nice job of documenting the fact that the number of EI recipients is falling, despite the fact that unemployment is rising.
But it seems to me that the crisis in EI is forever falling on deaf ears. Even though only 37.5% of unemployed workers are receiving EI, pundits and politicians feel that the problem with EI is not access, but high premiums. Improving access is usually not even presented as an option. If there's a surplus in the EI Account, it must be that there is too much revenue, full stop.
Recent case in point. The Mowat Centre agrees with my assessment that the federal budget surplus is coming out of the annual EI surplus. But, they frame this in terms of premiums that are too high, ignoring the abysmally low proportion of unemployed workers that are receiving EI.
The difference is not a subtle one. In one case, the government is balancing the budget on the backs of unemployed workers by denying them benefits, and in the other case they are doing it on the backs of employers and employees (i.e. current contributors).
In the past year, the number of EI recipients has fallen 4x faster than the number of unemployed workers. That is, the number of unemployed workers fell by only 3,000 at the same time as the number of EI recipients fell by 12,000. The trend over the past five years is shown in the graph below. (Source for unemployment: CANSIM 282-0087, Source for Regular EI recipients: CANSIM 276-0022)
The red line is the number of EI recipients, and goes with the numbers on the left axis. The blue line is the number of unemployed workers, and goes with the numbers on the right axis.
Since May 2009, the number of unemployed workers has only fallen by 210,000 – or about 14% (so much for those million jobs Stephen Harper single-handedly created). The number of EI recipients has fallen by 300,000 – about 38% of the May 2009 amount. This shows up clearly on the graph above – proportionately, the number of EI recipients has fallen at two and half times the rate of unemployment.
While Federal Government program cuts, staffing cuts, and changes to appeals systems have made EI far stingier, simply reversing them doesn't solve the problem. Labour market dynamics have evolved significantly even over the past 20 years or so. For example, in 1992, about 25% of unemployed workers were new entrants or re-entrants to the labour market. By 2012, that had risen to 45%. (Chart shows 12 month moving average, Source: CANSIM 282-0214).
In order to access EI, new labour market entrants and those that have not contributed to EI in the past two years must rack up at least 910 EI insurable hours in order to qualify for benefits or training supports. This is a giant barrier to a group of people who are most likely to make use of training and other supports offered through EI Part II.
Another issue is regional differences. Temporary and precarious urban workers (who are often racialized) face a much higher bar to entry than workers in regions with high unemployment rates. Urban workers often face many more barriers to secure employment than the regional unemployment rate conveys.
The only fair solution is a single national entrance requirement. A bar of 360 hours is equivalent to 30 hours per week for 12 weeks, which gets you in the door and able to access training benefits *if you lost your job through no fault of your own*.
The alternative is a deeply cynical one. If we say that premiums are too high, and current EI contributors are the victims of the government's greedy tax grab, we're also saying that it's perfectly OK that only 37.5% of unemployed workers are receiving EI. We're saying that it's perfectly justifiable that the number of EI recipients are falling while the number of unemployed workers are increasing. We're saying that it's OK that EI access and EI training supports are out of reach for most of the 500,000 unemployed labour market entrants and re-entrants.
It's not OK. No one who takes a minute to think of the people who are falling through the cracks could say that it even approaches OK. Stealing from the unemployed to deliver a balanced budget before the next election is pretty much the opposite of OK.