Ross, Thomas W. --- "Recent Canadian Policy Towards Industry: Competition Policy, Industrial Policy and National Champions" [2010] ELECD 370; in Mateus, M. Abel; Moreira, Teresa (eds), "Competition Law and Economics" (Edward Elgar Publishing, 2010)

Book Title: Competition Law and Economics

Editor(s): Mateus, M. Abel; Moreira, Teresa

Publisher: Edward Elgar Publishing

ISBN (hard cover): 9781848449992

Section: Chapter 22

Section Title: Recent Canadian Policy Towards Industry: Competition Policy, Industrial Policy and National Champions

Author(s): Ross, Thomas W.

Number of pages: 29

Extract:

22. Recent Canadian policy towards
industry: competition policy,
industrial policy and national
champions
Thomas W. Ross1

I. INTRODUCTION

Industrial policy and competition policy have been linked in Canada
almost from the beginning. Canada's first Prime Minister, Sir John A.
MacDonald, introduced perhaps the nation's first significant industrial
policy, the National Policy, in 1879.2 Erecting substantial tariff barriers to
the importation of manufactured goods, this was MacDonald's attempt to
create a domestic manufacturing base (largely in central Canada ­ Ontario
and Quebec) to reduce dependence on imports from the United States and
the United Kingdom. In terms of its objective of creating that base, the
National Policy was somewhat successful ­ but at a cost. For example,
western farmers forced to pay high prices for domestically manufactured
goods but sell their outputs in competitive North American (or broader)
markets resented the special treatment granted to central Canada by the
policy.
Not surprisingly, the protection of a small market by high tariff bar-


1 The author gratefully acknowledges helpful discussions and communications

with Bruce Doern, Donald McFetridge, William Stanbury and Lawrence White.
He is particularly indebted to Marc Duhamel of Industry Canada for considerable
assistance with the literature and Canadian data. He also wishes to acknowledge
the very capable research assistance of Jennifer Ng; and the financial support of
the Phelps Centre for the Study of Government and Business in the Sauder School
of Business in the University of British Columbia.
2 Canada secured its independence from Great Britain in ...