Sustainable Prosperity's Submission to the Ontario Standing Committee on Social Policy

Our Sustainable Communities program focuses on analyzing and developing a broad array of market-based instruments to help municipalities address environmental concerns while boosting their economies and improving their fiscal capacity.

Because prices are a strong influence on decisions, in order to achieve their policy goals governments will need to work to align prices with those goals. Where prices are pulling in the direction of policy goals, it will be much easier to achieve those goals. Governments in Canada - and in all developed countries - already employ pricing policy to help achieve their policy goals, e.g. to promote retirement savings (RRSP tax deductions), reduce youth tobacco consumption (tobacco taxes) or reduce waste and pollution (fee for plastics bags at grocery stories, tipping fees at municipal landfill, or carbon taxes).

For further discussion of the issues outlined in this submission, please refer to Sustainable Prosperity’s, "Government of Ontario Development Charges System Review – Submission," “Suburban Sprawl: Exposing Hidden Costs, Identifying Innovations,” and “Managing Urban Sprawl: Reconsidering Development Cost Charges in Canada.”

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About the Project

The goal of this project is to shed light on the relationship between economic activity and the environment by exploring the linkages between changes in our natural capital and our measures of productivity generally, and through the construction of an environmentally adjusted measure of productivity specifically.

While it is now commonly accepted that economic activity and the state of our environment are linked, many economic measures still fail to incorporate the environment – both the things we draw from it and the pollution we release into it. By developing and calculating measures of productivity that include natural capital, Canada may be able to better understand these linkages. This, in turn, may lead to the identification of strategies that can help Canada become more efficient and innovative in the use and protection of natural capital, and thus more productive and more prosperous.

Using the forestry sector as a case study, this project aims to construct an environmentally adjusted measure of multifactor productivity. In doing so, we aim to add another layer of understanding to the environmental and economic performance of this sector. The proposed measure will have relevance to the Canadian economy as a whole.