Saskatchewan and TILMA

TILMA is the Trade Investment and Labor Mobility Agreement. The Conference Board figures show great benefits for BC but the data and the technique for calculation of benefits were as this article points out quite suspect. Critics worry that these agreements are part of deep integration with the US and curtail the powers of municipalities.

Saskatchewan and TILMA
Posted by Erin Weir under TILMA , economic models

Today, the Government of Saskatchewan initiated a process of legislative consultations on TILMA and released the Conference Board’s assessment of this agreement’s potential impact on Saskatchewan. This document is the sequel to the Conference Board’s BC assessment, which Marc and I critiqued on this blog and in our paper.

I have not yet read through the 55-page document, but will provide some initial impressions. The Conference Board has retained its matrix of industries and regions, but dropped its GDP-impact scale in favour of simply treating the final “score” as a percentage of GDP. This “methodology” is still completely arbitrary, but produces appreciably less extreme results. Whereas the Board projected gains equal to 3.8% of GDP and 78,000 jobs for BC, it projects 0.92% of GDP and 4,400 jobs for Saskatchewan. These Saskatchewan estimates are still unbelievably high, but also so dramatically different from the BC estimates as to constitute a repudiation of the Conference Board’s previous work.

Interestingly, the provincial government has released the Conference Board’s document in conjunction with other materials. Brian Copeland’s excellent paper, which Marc and I cited and which used to only exist in hardcopy, is now available online. The government has also provided reviews of the Conference Board’s assessment by two academic economists, Dr. John Helliwell and Dr. Eric Howe.

The following are some key quotes from pages 6 and 7 of Helliwell’s piece:

“The principal source of data for the paper was a survey that asked representatives of firms, organizations and government agencies and departments to list what they thought to be the most important barriers to inter-provincial trade in their company, region or industry, and then provide qualitative rankings of winners and losers by region and industry. The latter were then converted to measures of long-term changes in income and employment by Conference Board staff. Since there was no research or quantitative base for this translation, it has no empirical basis, and hence cannot be treated as evidence. . . . In my view, this is an inappropriate use of the survey instrument, akin to estimating national GDP by asking households how they think everyone else is doing these days. . . . there is no empirical support for the Conference Board estimates of GDP and employment changes.”