The Fraser Institute

The Fraser Institute

November 28, 2012 06:32 ET

Fraser Institute: Quebecers Have Less Economic Freedom Than Vast Majority of North Americans

MONTREAL, QUEBEC--(Marketwire - Nov. 28, 2012) - Quebec continues to grapple with one of the lowest levels of economic freedom in North America, according to a new report released today by the Fraser Institute, Canada's leading public policy think-tank.

The Economic Freedom of North America 2012 report ranks Quebec ahead of only Nova Scotia and Prince Edward Island among Canadian provinces. Including U.S. states, Quebec ranks 50th out of the 60 provinces and states included in the rankings.

"The lack of economic freedom in Quebec translates to a lower standard of living and fewer opportunities for Quebecers," said Filip Palda, Fraser Institute senior fellow and professor at École nationale d'administration publique.

"That puts the province at a serious disadvantage compared to other parts of Canada where families benefit from increased prosperity."

The Economic Freedom of North America 2012 report measures the effect of economic freedom on the level and growth of economic activity in the Canadian provinces and American states. It measures key indicators of economic freedom based on size of government, taxation, rule of law and property rights, and regulation using data from 2010 (most recent year available). The complete report is available for download as a free PDF at www.institutfraser.org.

The study measures economic freedom at two levels: the subnational and the all-government (comprising federal, state/provincial, and municipal/local). This year's report includes a "world-adjusted" index for Canada and the Unites States at the all-government level using data from the Fraser Institute's Economic Freedom of the World: 2012 Annual Report, which ranked Canada fifth out of 144 nations and territories, well ahead of the United States in 16th.

Economic freedom is based on the cornerstones of personal choice, voluntary exchange, freedom to compete, and security of private property. Research shows that people living in jurisdictions with high levels of economic freedom enjoy greater economic growth, higher incomes, more individual freedoms, and longer life spans.

This year's report ranks Alberta as the most economically free jurisdiction in all North America. Saskatchewan was the second highest-ranked Canadian province at third overall followed by Newfoundland and Labrador in ninth spot and British Columbia 10th.

Ontario (21st) and Manitoba (32nd) are the next highest ranked provinces, followed by New Brunswick (45th), Quebec (50th), Nova Scotia (56th), and Prince Edward Island last overall (60th).

The report also shows that Canadian provinces with the most economic freedom (Alberta, Saskatchewan, Newfoundland and Labrador) had an average per-capita GDP of $60,163 (Cdn) in 2010, compared to the three provinces with the least economic freedom (Quebec, Nova Scotia, Prince Edward Island) at $45,872 (Cdn).

"The link between economic freedom and prosperity is clear: the provinces that support low taxation, limited government, and flexible labour markets benefit from greater economic growth," Palda said.

"Unfortunately, Quebec continues to suffer from big government, high taxes, unaffordable social programming, and fraught labour relations, all of which undercut prosperity."

The Economic Freedom of North America index is an offshoot of the Fraser Institute's Economic Freedom of the World index, the result of a quarter century of work by more than 60 scholars, including three Nobel laureates.

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The Fraser Institute is an independent Canadian public policy research and educational organization with offices in Vancouver, Calgary, Toronto, and Montreal and ties to a global network of 85 think-tanks. Its mission is to measure, study, and communicate the impact of competitive markets and government intervention on the welfare of individuals. To protect the Institute's independence, it does not accept grants from governments or contracts for research. Visit www.fraserinstitute.org.

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