Trade in similar products or intra-industry trade results from scale economies and consumer preferences, rather than from conventional forces of comparative advantage. This paper attempts to quantify the importance of intra-industry exchange between Canada and the United States. The analysis deals primarily with measurement, but an attempt to identify the determinants of the phenomenon is also made. / The results suggest that intra-industry trade represents a significant and increasing share of Canada's trade with the United States. Although part of this can be explained by idiosyncratic causes, the importance of two-way trade within manufacturing requires additional explanation.

In this thesis, the impact of United States final demand on Canadian demand and production is investigated using an interregional input-output model. First, the simple Leontief input-output model is considered. It is a disaggregated model of the production sector of an economy that allows a set of industry outputs to be expressed as a function of a corresponding set of industry final demands. It improves on other output determination models by admitting that industry outputs are interdependent. However, it requires the assumption of fixed production coefficients. Next, the extension of the model to incorporate interregional trade is considered. Several models are described that determine the industry outputs of each of a group of regions as functions of the industry final demands in all regions. A model is selected that differs from all of these, not in its essential algebraic structure, but in the method by which it is applied. In the simplified form in which it is used in this study, it requires that Canada's merchandise exports to the United States be reclassified according to the industry schemes of the Canadian and American input-output tables. The main advantage of the model over the other interregional models considered is that it allows the input-output tables of the individual regions to be used in their original form. Using the model, two questions are investigated. First, how do equal expenditures on the various components of United States final demand - Consumption, Fixed investment, Federal Government purchases, and State and local government purchases -compare in their impact on Canadian demand and output ? Second, in the period 1956 to I960, did variation in the level and pattern of United States final demand tend to aggravate fluctuations in Canadian demand, output, and net exports ? Several results are obtained. With reference to the first question, Investment expenditure is found to have considerably greater impact on Canadian demand and production than any of the other components of United States demand. The wide disparity in impact is largely explained by the concentration of Canadian exports to the United States on a few commodities. Concerning the second question, it is concluded that variations in both the level and pattern of United States final demand helped to generate fluctuations in the growth of Canadian demand and output. By contrast, the fluctuation of United States final demand tended to damp fluctuations in Canadian net exports. / Arts, Faculty of / Vancouver School of Economics / Graduate

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LD2668 .T4 1941 W71 / Master of Science

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This thesis begins with a review of the elite debate over free trade with the United States. It then uses a three-fold theoretical framework to formulate predictions of how mass opinion should line up. It then analyzes public opinion data on free trade through the use of crosstabulations. Using a theory of changing exposure to international trade upon domestic political cleavages formulated by Ronald Rogowski, it predicts that labour will oppose free trade because it is a scarce factor of production, and capital will support it because it is an abundant factor of production. It next uses work by, among others, W.A. Mackintosh to predict that respondents in the "industrial heartland" regions of Canada--Quebec and Ontario--will oppose free trade because it threatens to remove the protective tariff that rewards import replacement industries concentrated in those two regions. In contrast, residents of the "resource extracting and processing hinterland" regions—British Columbia, the Prairies and the Atlantic—will, on balance, support free trade because it promises to improve their export performance. The thesis then predicts that women and lower income Canadians will oppose free trade. Women because many of the services that they consume—health and day care, for example—will become more difficult to obtain under a free trade regime. Women will also oppose free trade because it may be threaten the service sector jobs that many women now hold. Lower income Canadians should oppose free trade because of the possible deleterious effects greater reliance on the market to allocate social services could have on poorer Canadians. Finally, the thesis predicts that better-educated Canadians will oppose free trade because it threatens one of the "core-values" of Canadian society: independence from the United States. Data analysis reveals, however, that opinion is remarkably balanced. For example, the difference between union and non-union respondents is only five percent. Regionally, the largest differences in support for free trade is between British Columbia and Ontario, but it amounts to little more than a twenty percent difference. Women are slightly more likely to oppose free trade than men; income appears to play little role in the formation of opinion on free trade. Last, differences in opinion between articulate and less well educated Canadians also appears to be insignificant. / Arts, Faculty of / Political Science, Department of / Graduate

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This research was undertaken to provide a quantitative assessment of the impact of a Canada/U.S. free trade agreement on six B.C. food and beverage processing industries. The objective was achieved by building a partial equilibrium model simulating changes in trade policy. The six industries were modelled as oligopolists in which the degree of oligopolistic behaviour and the industries' characteristics were captured through specified parameters. Following the abolition of trade barriers the model allowed the industries to rationalize, where necessary, and the highest-cost firms in an industry left for the benefit of lower-cost ones. The final effect is measured for each industry through changes in output, employment, trade volume and prices. As different policy scenarios have been simulated for each industry, the results obtained are quite diverse but they generally follow the a priori expectations. In open industries such as meat, fruit and vegetable and flour mixes, results, however differents for each scenario, tend to leave the industries in a better off or no worse off situation. For heavily protected industries like dairy and poultry, very sensitive to the elimination or not of the quota system, the range of possible results between the scenarios is pronounced. It was concluded that the final effect of the abolition of trade barriers on each industry cannot be assessed specifically but in rather general terms. / Land and Food Systems, Faculty of / Graduate