Internal Trade in Canada: Case for Liberalization

Jorge Alvarez, Ivo Krznar and Trevor Tombe

No 2019/158, IMF Working Papers from International Monetary Fund

Abstract: 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.

Keywords: WP; free trade; trade cost; real wage; Internal trade; gains from trade; input-output linkages; Canada; elasticity of trade; free trade trade agreement; cost elasticity; migration model; government procurement rule; Trade barriers; Trade agreements; Trade liberalization; Trade balance; Employment; Global; trade growth decomposition; data description; costs of trade barriers; trade in Canada (search for similar items in EconPapers)
Pages: 38
Date: 2019-07-22
New Economics Papers: this item is included in nep-int
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Citations: View citations in EconPapers (4)

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