Racing to the Bottom? Provincial Interdependence in the Canadian Federation

Extract

Racing to the Bottom? Provincial Interdependence in the Canadian Federation, Kathryn Harrison, ed., Vancouver: UBC Press, 2006, pp. 305.

There is a widely expressed concern that technological changes and lower barriers to trade and investment have reduced governments' ability to impose taxes on mobile inputs, such as financial capital or venture capitalists, and this will constrain their ability to provide basic public services and redistribute income. These forces are often described as producing a “race to the bottom,” in which governments compete through their tax, regulatory, and expenditure policies to attract footloose investments.