Productivity and competitiveness are weakened by government policies
Canada’s economic growth is lagging because of regulatory barriers according to a new report.
The Fraser Institute study says the country’s growth in GDP is the slowest since the 1930s with productivity and competitiveness constrained by official policies.
It means that Canada’s economic environment is not conducive to investment or innovation, says the study ‘Canada’s Faltering Business Dynamism and Lagging Innovation.’
“Canada’s sluggish economic growth in the years before the pandemic reflects a lack of innovation and weak productivity growth,” said report author Philip Cross, senior fellow at the Fraser Institute.
Cross’ report says that Canadian businesses have been impacted by “overbearing regulations” and that too much of the economy is based on limiting competition instead of helping to develop competitive markets.
His analysis found a decline in innovation originating in Canada which started in the 1990s, while the United States and United Kingdom were among the countries that were seeing an innovation surge.
“However you measure economic success, Canada has been underperforming for many years, and that has negative consequences for all Canadians who are denied the many benefits of a dynamic, healthy economy,” Cross said. “Governments should re-examine the policies that are contributing to this economic malaise with the goal of creating an environment more conducing to entrepreneurship, investment and innovation.”
