Today is Canada Day, some kind of national holiday in the United States’ largest export market and an excellent time to catch up on news about the Canadian economy.
For example, in Canada many fewer people are out of work:
On the other hand, Americans are richer than Canadians on average:
And it’s not just because we’re working long hours. We’re more productive!
On the other hand, of that almost $8,000-per-year gap in per-capita GDP, almost half is composed of the difference in per-capita health care spending:
Canada also spends 1.4 percent of GDP on defense to America’s 4.7 percent, which accounts for another $1,600 of the gap. So if Canadians don’t actually seem to be impoverished compared with Americans, it’s because the GDP gap is largely gowing into the maws of the military and health care sectors.
Last but by no means least, Canadian houses look really expensive compared with American ones:
This certainly looks like a bubble situation to me. Note in particular that it’s not just a chart of Canadian house prices being high, it’s a chart of the ratio of house prices to rents being high in Canada. There are logistical impediments to conducting large-scale own/rent arbitrage in these situations, but it seems likely that either prices will crash or rents will skyrocket at some point in the future, and it’ll be interesting to see how the Canadian economy copes.