Economies Of Scale And Efficient Plant Size In Canadian Manufacturing Industries

From the back cover: Canada can compete in international markets, but not, the authors contend, under the present national economic strategy. Policies that redistribute income and allocate resources through government fiat have weakended Canada's ability to transform its manufacturing sector to meet the new competititve challenges. D'Cruz and Fleck compare the performance of seventy-one Canadian industries from 1967 to 1981 with industries in Japan, the United States, Britain and France. To enhance the competitiveness of Canadian manufacturing, the authors propose a differential industrial strategy, one that emphasizes growth and development. Government, they say, must play a "hands-off" role in Canada's market economy, limiting itself to establishing the rules of the game. The authors recommend, in addition, macro-economic policies that would reduce the federal deficit, restrain wages for public servants, preserve low differentials between Canadian and American interest rates, and maintain the Canadian dollar at 70 cents U.S.

From the back cover: VOLUME 1 outlines the study's methodology and considers the explanations that have been proposed for Canada's productivity showdown. The study's data suggest that the decline is attributable more to outdated caiptal equipment than to the commonly cited "slump" in labour productivity. Author Uri Zohar applies the study's findings to the problem of industrial strategy: since the performance of different industries is highly disparate and subject to rapid change, macroeconomic policy is unlikely to be beneficial to all of them at once. A more specialized policy is needed one that backs "winner" industries identified on the basis of productivity measurements and national choices about social and economic development. VOLUME 2 provides the most extensive time-series studies done to date on manufacturing industries. Performance in each of the nineteen industry groups is studied using four production functions that quantify various factors contributing to productivity, and each industry group is compared against a benchmark average for the entire sector.