Front Matter
Author: International Monetary Fund
Publication Date:
08 Jun 1995
eISBN:
9781451806823
ISBN:
9781451806823
Language:
English
Keywords:
ISCR; CR; Canada; deficit
Download PDF (452.1 KB)

Front Matter Page

©1995 International Monetary Fund

June 1995

IMF Staff Country Report No. 95/46

Canada—Economic Developments and Policies

This report on economic developments and policies in Canada was prepared by a staff team of the International Monetary Fund as background documentation for the periodic consultation with this member country. In releasing this document for public use, confidential material may have been removed at the request of the member.

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International Monetary Fund

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Front Matter Page

INTERNATIONAL MONETARY FUND

CANADA

Economic Developments and Policies

Prepared by T. Alleyne (WHD), L. Bartolini (RES), E. Buckberg (WHD), E. Nedde (WHD), A. Thomas (WHD), and C. Towe (WHD)

Approved by the Western Hemisphere Department

April 18, 1995

Contents

  • Basic Data

    • I. Introduction

  • Tables

    • I-1. Recent Staff Studies on Economic Issues and Policies

Canada—Basic Data

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National income accounts basis.

December over previous December.

Change from December 1994 to March 1995.

Public accounts basis; fiscal year begin on April 1.

End-of-year values.

Contents

  • II. Real Sector Developments

    • 1. Output

    • 2. Labor market

    • 3. Costs and prices

  • Tables

    • II-1. Real Gross Domestic Product

    • II-2. Prices, Wages, and Costs

  • Charts

    • II-1. Factors Affecting Output Growth

    • II-2. Factors Affecting Exports

    • II-3. Factors Affecting Investment

    • II-4. Consumption and Saving

    • II-5. Factors Affecting Imports

    • II-6. Employment By Industry

    • II-7. Labor Force, Employment, and Unemployment

    • II-8. Participation and Unemployment Rates By Age and Sex

    • II-9. Employment: Levels, Hours, and Earnings

    • II-10. Price Developments

    • II-11. Capacity Utilization Rates

    • II-12. Wage Settlements, Indexes of Productivity, and Unit Labor Costs

  • III. Estimates of the Structural Rate of Unemployment

  • Charts

    • III-1. Components of the Unemployment Rate

  • IV. A Survey of Alternative Methodologies for Estimating Potential Output

    • 1. Introduction

    • 2. Atheoretical approaches

    • 3. The production-function approach

      • a. The two-stage method

      • b. The cointegrating vector approach

    • 4. Evaluation of alternative approaches

  • Charts

  • IV-1. Measures of the Output Gap

  • IV-2. Measures of Potential Output

  • V. Balance of Payments

    • 1. Overview

    • 2. Merchandise trade balance

      • a. Exports

      • b. Imports

    • 3. Invisibles balance

    • 4. Saving-investment balance

    • 5. Capital account

  • Charts

    • V-1. Current Account Balance

    • V-2. Competitiveness Indicators

    • V-3. Volume Indices

    • V-4. Motor Vehicle Indicators

    • V-5. Balance of Payments Flows and the Exchange Rate

  • VI. Monetary and Exchange Market Developments

    • 1. Monetary policy issues

      • a. Monetary policy objectives

      • b. Monetary policy operations

    • 2. Monetary conditions

    • 3. Monetary and credit developments

  • Charts

    • VI-1. Inflation Targets and Interest Rates

    • VI-2. Monetary and Credit Indicators

    • VI-3. Interest Rate Differentials and Exchange Rates

  • VII. Fiscal Policy Developments

    • 1. Federal fiscal developments during the 1983/84-1993/94 period

    • 2. Federal fiscal developments in 1994/95

    • 3. The 1995/96 budget

    • 4. The provincial fiscal situation

  • Tables

    • VII-1. Federal Fiscal Accounts

    • VII-2. Government Bond Ratings

    • VII-3. Transactions of the Consolidated Public Sector

    • VII-4. Transactions of the Consolidated Public Sector

  • VIII. Federal-Provincial Transfers–A Review and Assessment

    • 1. Introduction

    • 2. The federal-provincial transfer system

    • 3. An assessment of the system and prospects for reform

      • a. EPF grants and health care reform

      • b. EPF grants and post-secondary education

      • c. The CAP and welfare reform

      • d. Equalization payments

    • 4. The 1995/96 budget and the Canada Social Transfer

  • Charts

    • VIII-1. Per Capita GDP and Federal Transfers

  • IX. Unemployment Insurance in Canada

    • 1. History and main program features

    • 2. Trends in the labor market and UI usage

    • 3. Proposals for reform

      • a. General issues

      • b. Specific proposals

      • c. Financing issues

  • X. Public Support for the Elderly in Canada

    • 1. Overview

    • 2. Main programs for support of the elderly in Canada

    • 3. Prospects for reform

  • Tables

    • X-1. Distribution of Net Elderly Benefits by Household Income, 1994

  • XI. Federal Spending on Government Operations and Defense

    • 1. Overview

    • 2. Defense

    • 3. Other government operations

      • a. Overview and recent cost-containment initiatives

      • b. Prospects for further savings in other government operations

  • Tables

  • XI-1. Operations of the Federal Government, 1992/93

  • XII. The Federal Goods and Services Tax

    • 1. Sales tax reform: replacing the FST with the GST

    • 2. Problems with the GST

    • 3. Alternatives to the GST

    • 4. Federal and provincial GST reform proposals

    • 5. Concluding discussion

  • XIII. Federal Tax Expenditures

    • 1. Personal income tax expenditures

    • 2. Corporate income tax incentives

    • 3. Goods and Services Tax (GST)

  • XIV. Illustrative Fiscal Policy Simulations

    • 1. Introduction

    • 2. Fiscal policy and distortionary taxes in MULTIMOD

    • 3. Illustrative fiscal shocks

      • a. Temporary reduction in transfers to households

      • b. Permanent cut in government consumption

      • c. Permanent cut in transfers to households

      • d. Permanent cut in transfers to firms

      • e. Permanent increase in consumption taxes

      • f. Permanent increase in labor income taxes

      • g. Permanent increase in capital income taxes

      • h. Decline in the interest rate premium

    • 4. A fiscal adjustment scenario

    • Annex

  • Tables

    • XIV-1. Temporary Cut in Transfers

    • XIV-2. Permanent Cut in Government Consumption

    • XIV-3. Permanent Cut in Transfers to Households

    • XIV-4. Permanent Cut in Transfers to Firms

    • XIV-5. Permanent Increase in Consumption Tax

    • XIV-6. Permanent Increase in Labor Income Tax

    • XIV-7. Permanent Increase in Capital Taxes

    • XIV-8. One-Half Percentage Point Fall in the Risk Premium

    • XIV-9. Fiscal Consolidation Package

  • XV. Official Development Assistance

  • XVI. Developments in Canadian Trade Policy

    • 1. The Uruguay Round Agreement

    • 2. The North American Free Trade Agreement (NAFTA)

    • 3. Trade disputes

    • 4. The agreement on internal trade

    • 5. Tariff code revision

    • 6. Generalized Preferential Tariff (GPT) extension

    • 7. Trade relations with the former Soviet Union and central and eastern Europe

    • 8. Other bilateral and multilateral trade policies

Cover IMF Staff Country Reports
Canada: Economic Developments and Policies
Author: International Monetary Fund
Volume/Issue:
Volume 1995: Issue 046
Publisher:
International Monetary Fund
ISBN:
9781451806823
ISSN:
1934-7685
Pages:
178
DOI:
https://doi.org/10.5089/9781451806823.002