Danny Leung

Small, Medium-sized and Large Businesses in the Canadian Economy: Measuring Their Contribution to Gross Domestic Product in 2005

The paper estimates the contributions to gross domestic product (GDP) made by small, medium-sized and large businesses in the Canadian business sector for 2005. The contribution of large businesses with 500 or more employees to business-sector GDP was 45.7%. Small and medium-sized businesses, including unincorporated businesses, accounted for the other 54.3%.

Labour Productivity of Unincorporated Sole Proprietorships and Partnerships: Impact on the Canada-United States Productivity Gap

This paper asks how the performance of self-employed unincorporated businesses affects the size of the gap in labour productivity between Canada and the United States. To do so, the business sector in each country is divided into unincorporated and corporate businesses, and estimates of labour productivity are generated for each sector. The productivity performance of the unincorporated sector relative to the corporate sector is much lower in Canada than in the United States. As a result, when the unincorporated sector is removed from the estimates for the business sector in each country and only the corporate sectors for the two countries are compared, the gap in the level of productivity between Canada and the United States is reduced. The unincorporated sector consists of both sole proprietorships and partnerships. This paper also investigates the impact of just sole proprietorships on the Canada-United States productivity gap. Sole proprietorships in the two countries more closely resemble one another than do partnerships, as U.S. partnerships are much larger than their Canadian counterparts. When sole proprietorships are removed from the business-sector estimates of each country (allowing a comparison of sole proprietorships to the rest of the business sector, which consists of partnerships and the corporate sector), the gap in labour productivity between Canada and the United States also declines but by only about half as much as when both sole proprietorships and partnerships are removed. The lower productivity of the unincorporated sector (both sole proprietorships and partnerships) accounted for almost the entire productivity gap between Canada and the United States in 1998. Since then, the productivity of the corporate sector in Canada has fallen relative to that of the corporate sector in the United States and the unincorporated sector no longer accounts for the entire gap.

The Contribution of Small and Medium-Sized Businesses to Gross Domestic Product: A Canada-United States Comparison

Adopting the methodology used to produce estimates of gross domestic product (GDP) by size for the United States, this paper estimates GDP for small and medium-sized businesses versus large businesses for the Canadian non-agricultural business sector in 2005. In the entire non-agricultural business sector, small and medium-sized businesses with less than 500 employees account for 54.2% of GDP in Canada and for 50.7% of GDP in the United States. When two industries with heavy government ownership in Canada (health and education) are excluded, the results are 52.9% and 50.3%, respectively.

What affects MFP in the long-run? Evidence from Canadian industries

Using data on 12 Canadian industries for 1976–2003, this study employs a dynamic panel error correction model to establish the relative importance of potential determinants of Multifactor Productivity (MFP). The model restricts the long run coefficients of these factors to be the same across industries, but allows industry heterogeneity in the short-run coefficients. After controlling for capacity utilization, Information and Communications Technologies (ICT) capital, outsourcing and global trade openness are found to have a statistically significant positive effect on MFP. The long run impact of ICT is small, but its recent contribution to MFP growth is sizeable for some industries, possibly reflecting the delayed benefits of the ICT investment surge in the late 1990s due to adjustment costs. Global trade openness and industry outsourcing generally raises MFP.

The Dynamics of Male Self-employment in Canada: Comparing the 1990s to the 2000s

This paper examines how the nature of self-employment may have changed, by comparing the labour market transition rates for males (between non-employment, paid employment, own-account self-employment, and self-employment with paid help) in two panels of the Survey of Labour and Income Dynamics (SLID): the 1993-1998 panel and the 2002-2007 panel. An econometric model is then estimated for the purpose of characterizing the change further.