Real Gross Domestic Product (GDP)-the output of goods and services provided by labor and property. The comparison of Canada and the U.S. has always been a close race. The United States is usually always slightly ahead. They are currently very similar when it comes down to raw statistics.
After a couple of decades of declining growth rates, many economies now know that high income developed economies can no longer achieve and sustain real growth rates of 3.5 percent and up. There are many reasons for this. For a little while it was being blamed on rising energy prices. Some now argue that wealthy, high-income nations are unable to grow rapidly because their citizens are unwilling to save very much. Also, some are trying to say that there are some constraints imposed by technology, or global movement of capital. Canada has only increased by 4 percent over the past five years. Only three provinces and one territory have rates over the national average. Alberta with the lead of 10.3 percent and Nunavut following with 8.1 percent. Ontarioâ€™s rate is at a climbing 6.1 percent with B.C. right behind with a 4.9 percent.
(See exhibit 3-1).
Unemployment for United States and Canada is considered to be a twin mystery. There is a high correlation between unemployment rates and the emergence of a gap between these rates around 1982. There is an argument that there is an apparently close emergence rates are highly persistent. The permanent increase in the gap is not strikingly large compared with other years. That means that there is little reason to limit explanations for the current gap to events that took place in 1982.
(See exhibit 3-2).
Business cycles are periodical swings in an economies pace of demand and production activity. These cycles are characterized by alternating phases of growth and stagnation. Canadaâ€™s business cycles have a direct impact on their citizens. Economic boom brings jobs, growth, and economic prosperity.