IMF Working Papers

Internal Trade in Canada: Case for Liberalization

By Jorge A Alvarez, Ivo Krznar, Trevor Tombe

July 22, 2019

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Jorge A Alvarez, Ivo Krznar, and Trevor Tombe. Internal Trade in Canada: Case for Liberalization, (USA: International Monetary Fund, 2019) accessed December 21, 2024

Disclaimer: IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.

Summary

This paper assesses the costs of internal trade barriers and proposes policies to improve internal trade. Estimates suggest that complete liberalization of internal trade in goods can increase GDP per capita by about 4 percent and reallocate employment towards provinces that experience large productivity gains from trade. The positive impact highlights the need for federal, provincial and territorial governments to work together to reduce internal trade barriers. There is significant scope to build on the new Canadian Free Trade Agreement to more explicitly identify key trade restrictions, resolve differences, and agree on cooperative solutions.

Subject: Employment, International trade, Labor, Trade agreements, Trade balance, Trade barriers, Trade liberalization

Keywords: Canada, Cost elasticity, Costs of trade barriers, Data description, Elasticity of trade, Employment, Free trade, Free trade trade agreement, Gains from trade, Global, Government procurement rule, Input-output linkages, Internal trade, Migration model, Real wage, Trade agreements, Trade balance, Trade barriers, Trade cost, Trade growth decomposition, Trade in Canada, Trade liberalization, WP

Publication Details

  • Pages:

    38

  • Volume:

    ---

  • DOI:

    ---

  • Issue:

    ---

  • Series:

    Working Paper No. 2019/158

  • Stock No:

    WPIEA2019158

  • ISBN:

    9781498326650

  • ISSN:

    1018-5941

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