The level of uncertainty will depend on several factors: the nature of the functional form used in the multivariate analysis; the type of econometric technique employed; the appropriateness of the statistical assumptions embedded in the model or technique; the comprehensiveness of the variables included in the analysis; and the accuracy of the data that are utilized. [...] The paper illustrates the usefulness of alternate measures of economic activity, that is, those that take into account non-production sources of real income growth (such as the terms of trade that influence the purchasing power of Canadian income generated by the production process or the flow of primary incomes through the current account). [...] The paper then moves beyond the richness of historical detail to make use of a summary statistic that cumulates the individual series at the aggregate level to evaluate the overall effect of changes in the terms of trade on well-being. [...] While others have focussed on the evolution of the prices of individual products when studying the terms of trade, none has cumulated the individual series together at the aggregate level to evaluate the overall effect of changes in the terms of trade on well-being using officially recognized measures from the 1993 SNA. [...] The SNA approach answers the essential question that is at the heart of debates over the advantage or disadvantage of a resource-based export economy: how have changes in the terms of trade for resources increased the real income of Canadians?
Authors
- ISBN
- 9781100204932
- Pages
- 97
- Published in
- Canada
