ECON 1BB3 Chapter 4: Chapter 4.docx

• School: McMaster University
• Department: Economics
• Course: ECON 1BB3
• Professor: Bridget O' Shaughnessy

Document Summary

Chapter 4 - the role of government in business. Canadian manufacturing, which had higher costs crown corporations that are owned by the federal or provincial gov"t they provided services that were not being provided by businesses (ex. Air canada) created to bail out a major industry in trouble (ex. Canadian national railway) they provided some special services that could not otherwise be made available (ex. Canada has a legislature in each province and territory to deal with local matters. Parliament in ottawa makes laws for all canadians. The constitution defines the powers that can be exercised by the federal and provincial gov"ts. The gov"t spends money in many areas, including special programs, highways, the environment, etc. If the gov"t spends over and above the amount it gathers in taxes for a specific period of time then it has a deficit. The national debt (federal debt) is the accumulation of gov"t surpluses and deficits over time.