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Marr, B. An Introduction to Canadian Economic History
WILFRID LAURIER UNIVERSITY Waterloo, Ontario ECONOMICS 237 An Introduction to Canadian Economic History COURSE OUTLINE September 1995 Dr. Bill Marr P2046 Extension 2468 Office Hours:Tuesday, 1:00 p.m. - 3:30 p.m.; Thursday, 3:00 p.m. - 4:30 p.m. Class Meetings: Monday, Wednesday, Friday: 9:30 a.m. - 10:20 a.m. Classroom: 2-201 Secretary: Jennifer Dilella, Ext. 2056, P2038 Prerequisite: Economics 120 and 140 Text: Marr, W.L. and D.G. Paterson. Canada: An Economic History. Organization of the Course: Goals This course is intended to familiarize you with the major features of Canadian economic growth and development from the time of New France to about 1867. Both the general outline of Canada¹s output and structure are examined. At the end of the course, students should be able to discuss the forces that influenced this growth and development up to Confederation. The primary concern is to discuss and explain the processes of economic growth and economic development in Canada. Economic historians have tried to interpret this using the staple approach which emphasizes the role of primary export products as leading sectors in the growth process. Discussion will centre on the usefulness of the staple thesis as a unifying theme to explain Canadian economic growth; with its export orientation and dependent resource status, Canada¹s economic history must be looked at in a North American and European context. The general topics covered include the following from the text: 1. Economic Analysis of History: An Introduction: Marr and Paterson: Chapter 1, pp. 18-25. 2. Patterns of Aggregate Economic Change: Marr and Paterson: Chapter 1, pp. 10-18. 3. The Early Staples: Renewable Natural Resource Exploration: Marr and Paterson: Chapter 3. 4. Agricultural Development in central Canada to 1867: Marr and Paterson: Chapter 4, pp. 74-101;pp. 101-108 (selectively) Library Readings Agricultural Development in Lower Canada Agriculture in Canada West: Mainly Wheat Economic Unrest in the 1830s. 5. Commercial Policy Before Confederation: Marr and Paterson: Chapter 5 Library Readings: The Reciprocity Treaty of 1854. 6. Transport: Investment in Infrastructure: Marr and Paterson: Chapter 10, pp. 302-321. 7. Capital Formation and Mobilization: Marr and Paterson: Chapter 8, pp. 235-239; pp. 243-251 8. Population Growth in Canada: Marr and Paterson: Chapter 6,pp. 149-151; pp. 155-158; pp. 162- 172 Course Objectives Course objectives specify a certain action or behaviour on your part. An objective contains a statement of what you will be able to do once a particular topic has been discussed. Two examples taken from the course are: Students should be able to describe the general methodologies of economics and history. Students should be able to use the three sector trade model to predict how several events in the 1820s and 1830s affected the economy of British North America through the Corn Laws. A set of course objectives will be handed out for each of the topics mentioned in the previous section of this handout. Outside of Class Times You will see that I have listed my office hours at the start of this document. Those are times that I try to reserve for meeting with you and other students in this and my other courses. If those times are inconvenient or you would like to see me at a different time, please talk with me about an appointment. You can also communicate with me through e-mail. On the PINE system, my address is: email@example.com Send me an e-mail message at your convenience, and if required, I will get back to you as soon as possible. Additional Readings These will be announced in class and will be available in the Library Reserve Room. Term Work: 1. You will prepare one major essay on a selected topic in Canadian economic history covered in the course. See Guideline for Essays for more information. Your essay will be due on or before Wednesday, November 29, 1995 without penalty; for each weekday after that date, two marks will be subtracted from the grade for lateness. Except under unusual circumstances, no essay will be accepted after December, 1995. In order to provide you with some feedback, a very short (maximum two pages plus references) plan for your essay should be handed in on or before Wednesday, October 15, 1995. Your plan should contain statements of your topic, the problem selected for investigation, the final paper¹s hypothesis(es) or objective(s), the methodology to be used, followed by a list of the references that you have consulted. 2. You will write a critical review of the journal article: Ann Carlos and Patricia Fulton. ŒChance or Destiny? The Dominance of Toronto over the Urban Landscape, 1797-1850.¹ Social Science History 15 (Spring 1991), 35-66. Copies are on reserve in the Library, 6th. floor Reserve Desk. Your review will be due on or before Tuesday, November 14, 1995 without penalty; late penalties are the same as for the major essay and are noted above. See Guideline for Critical Reviews for more information. 3. There will be two tests in the course: (a) One in-class test: Wednesday, October 11, 1995 (b) December final - 2 1/2 hours Each test may cover the material from the first class in September to the class previous to the test. All tests are open book, and essay-type questions are asked. If you miss an in-class test for a legitimate reason (e.g. illness), the weight of that test will be added onto the weight of the December final; there will be no make-up for in-class tests. 4. The final grade will be computed as follows: October test 15% Critical Review 20% December final 25% Essay 40% Total 100% LIBRARY READINGS ECONOMICS 237 1995 The following articles or books are on reserve in the Library and you are expected to read all of them or their relevant portions sometime during the term. A compulsory question which deals in part with these readings will be on the final examination. Agricultural Development in Lower Canada John McCallum, Unequal Beginnings: Agriculture and Economic Development in Quebec and Ontario Until 1870, pp. 25-53. R.M. McInnis, ŒA Reconsideration of the State of Agriculture in Lower Canada in the First Half of the Nineteenth Century,¹ Canadian Papers in Rural History, Vol. III, pp. 9-49. P. Phillips, ŒLand Tenure and Economic Development: A Comparison of Upper and Lower Canada,¹ Journal of Canadian Studies, 9, No. 2 (1974), 35-45. The Reciprocity Treaty of 1854 L.H. Officer and L.B. Smith, ŒThe Canadian-American Reciprocity Treaty of 1855 to 1866,¹ Journal of Economic History, 28 (1968), 598-623. R.E. Ankli, ŒThe Reciprocity Treaty of 1854,¹ Canadian Journal of Economics, 4 (1971), 1-20. S.A. Saunders, ŒThe Reciprocity Treaty of 1854: A Regional Study,¹ Canadian Journal of Economics and Political Science, 2 (1936), 41-53. S.A. Saunders, ŒThe Maritime Provinces and the Reciprocity Treaty,¹ Dalhousie Review, 14 (1934), 155-171. Agriculture in Canada West: Mainly Wheat F.W. Burton, ŒWheat in Canadian History,¹ Canadian Journal of Economics and Political Science, 3 (1937), 210-217. K. Kelly, ŒWheat Farming in Simcoe County in the Mid-Nineteenth Century,¹ Canadian Geographer, 15 (1971), 95-112. D. McCalla, ŒThe Wheat Staple and Upper Canadian Development,¹ Historical Papers (1978), 34-45. Economic Unrest in the 1830s D.G. Creighton, ŒThe Economic Background of the Rebellions of 1837,¹ Canadian Journal of Economics and Political Science, 3 (1937), 322-334. W.H. Parker, ŒA New Look at Unrest in Lower Canada in the 1830s,¹ Canadian Historical Review, 40 (1959), 209-218. Angela Redish, ŒThe Economic Crisis of 1837-1839 in Upper Canada: Case Study of a Temporary Supervision of Specie Payments,¹ Explorations in Economic History, 20 (October 1983), 402-417. Economics 237 Some Suggested Essay Areas 1. Early Staples: (a) The Staple Thesis as an Explanation of Growth and Development (b) The Fishing Trade as a Response to Changing Demand and Technology (c) The Trade in Timber (d) Settlement and the Timber Trade (e) The Fur Trade - Competition vs. Survival (f) The Seigniorial System - Causes or Effects (g) Staples as a Kind of Imperialism 2. Agricultural Development in Central Canada: (a) Causes of Agricultural Backwardness in Lower Canada (b) The Corn Laws: Aid or Hindrance? (c) Causes of Agricultural Change after 1860 (d) Technological Change: Response to Supply Constraints and Demand Pressure (e) The Seigniorial System - Cause of Agricultural Stagnation 3. Commercial Policy Before Confederation: (a) The Reciprocity Treaty of 1854 - Success or Failure? (b) British North American Tariffs and Economic Growth (c) The Role of the Navigation Acts in British North America (d) The Timber Duties and Staple Development (e) The Corn Laws and Staple Development (f) The End of Colonial Preferences: Help or Hindrance? 4. Population Growth in Canada: (a) The Determinants of Canadian Immigration (b) Population Size and Economic Growth and Development (c) The Determinants of Internal Migration (d) The Economic Effects of Migration (e) Fertility Decline: Its Historical Causes 5. Transport: Investment in Infrastructure: (a) Early Roads: Necessity or Luxury? (b) Transport as Defensive Expansionism (c) Private and Social Rates of Return to Railways (d) Transport and the Staple Thesis (e) Early Canals: Why Are They Unsuccessful? (f) The First Railroads and Canadian Growth (g) Metropolitanism and Transport Development 6. Aggregate Economic Change: (a) The Contribution of Labour, Capital and ŒTechnology¹ to Economic Growth (b) Canada as a Dependent Resource Economy (c) Causes of Major Sectoral Shifts of Output Guideline for Critical Reviews Criteria For Evaluating Research Studies I have listed below a number of points to ponder as your write your critical review. In essence, those points are presented as questions that you may ask when you evaluate the research under study. My points or questions are organized under headings that correspond with some common elements of empirical research. Please do not feel constrained by my points or questions; they are meant only to provide you with some suggestions of areas to address in your review, but by all means include your own points. Do not spend any space just describing the content of the research that you are reviewing. I have read the material and know what it is about. Instead, relate the content directly to the critical points that you discuss. Length: 6 to 8 pages, typed, double-spaced, normal margins. Criteria Report¹s Purpose, Problem, and Objective 1. Is there a statement of the problem? Are the objectives of the study stated clearly? 2. Is the problem Œresearchable,¹ that is, can it be investigated through the collection and analysis of data? 3. Is background information on the problem given? 4. Is the significance or importance of the problem to Canadian economic history made clear? Have the researchers put forth an argument as to why this problem is worthy of investigation? 5. Is the researcher¹s intent clear? 6. Has all relevant background information for the research study been presented? Review of Related Literature 1. Is the review comprehensive? 2. Are all the references cited relevant to the problem under investigation? 3. Have the references been critically analyzed and the results of various studies compared and contrasted? Is the topic placed in the context of the area of study as a whole? 4. Is the review well organized? 5. Do the implications discussed form an empirical or theoretical rationale for any hypotheses that follow? Hypotheses 1. Are specific questions to be answered listed or specific hypotheses to be tested stated? 2. Does each hypothesis state an expected relationship or difference between two variables? 3. Do the hypotheses relate logically to some theory that links those variables in a cause-and-effect manner? 4. Is each hypothesis testable? Method, Research Design, and Procedures 1. Are the procedures for testing any hypotheses clearly described? Are those procedures appropriate in this case? Is there a careful accounting of why the particular methods, tools, and techniques were used? 2. Are the data complete, accurate, and applicable to the problem being investigated? Are the selected methods of data collection accurately described? Are limitations and weaknesses of the data discussed? 3. Are the data presented in a helpful manner? 4. Are all terms clearly defined? Do you agree with the measures that are used for the concepts and variables? 5. Are appropriate descriptive statistics presented? Analysis and Discussion of Results 1. Is each result discussed in terms of the original hypothesis to which it relates? 2. Is each result discussed in terms of its agreement or disagreement with previous results obtained by other researchers in other studies? 3. Are the possible effects of uncontrolled variables on the results discussed? Are feasible alternative explanations that might exist for the results discussed? 4. Are the results presented clearly? Is the written description consistent with the data? 5. Are the researcher¹s interpretations consistent with the obtained results? Do they place the study in a broader perspective? 6. If data fail to support hypotheses or solve the problem, is this pointed out in the analysis? Conclusions 1. Are recommendations for future research made? 2. Are the conclusions at a scope and level of generality justified by the data presented? 3. Are the conclusions a precise and accurate statement of the problem, the methods followed, and the findings without the introduction of new or irrelevant information? 4. Are appropriate cautions exercised and necessary qualifications made in drawing conclusions? Organization and Style 1. Is the paper organized in a way that makes it easy to follow and understand? Does the overall organization of the sections, subsections, and paragraphs of the paper allow you to follow easily the logic and flow of ideas and concepts? 2. Are tables, charts, graphs and figures (if any) well- organized and easy to understand? 3. Are there problems of spelling, grammar, and syntax? Are sentences structured and worded to convey ideas in clear, concise language? 4. Does the format of the paper follow an accepted style, including notes and references? CHAPTER 1 Economic Analysis of History: An Introduction Why Teach/Study Economic History 1. Inherent - Educative Qualities 2. Critical Faculty 3. Understand Present and Future The student should be able to: i) describe the general methodologies of economics and history; ii) show how the economic historian borrows and uses the methodologies of economics and history; iii) describe intellectual inquiry in terms of assessment, weighing of evidence, and manipulation, and in terms of hypotheses testing, theoretical foundations, and empirical testing; iv) define economic history; v) describe three reasons for studying the content of economic history: (a) past is prologued to the present, (b) present is a transition from past to future, and (c) past is with us in the present. Economic Development 1. Role of Generalizations in Economic History 2. Economic Growth and Economic Development 3. Structural Change: Geographical Spread, Distribution of Income, Sectoral Output Distribution 4. Dependent Resource Economy The student should be able to: i) define economics in terms of the science of choice; ii) relate economic history to this definition of economics; iii)distinguish economic growth from economic development; iv) describe the general determinants of economic growth: population, resources, technical change, capital, residual; v) describe the factors related to economic development: technical change, institutional change, welfare improvement, structural change; vi) define the above factors, and provide examples from Canada¹s economic history; vii) define a dependent resource economy and show that Canada has generally fit this definition; derive implications for economic growth and development if an economy is a dependent resource economy. The Time Dimension 1. Long-run Forces and Short-Run Cycles The student should be able to: i)distinguish between long-run forces that affect the Canadian economy and short-run cycles that exhibit no trend. A synoptic View of Canadian Economic Development 1. Eras of Rapid Canadian Growth and Development 2. Growth and Welfare 3. Real G.N.P. per Capita 4. Canada¹s Experience of Modern Economic Growth The student should be able to: i) provide Œoperational definitions¹ of economic growth (e.g. real GNP) and of economic development (e.g. real GNP per capita), and list periods in Canada¹s economic history when growth and development were relatively rapid; ii) create the identity real GNP per capita is equal to real output per worker multiplied by the labour force participation rate; iii) describe the factors that affect real output per worker and the labour force participation rate; iv) describe several limitations of real GNP per capita as a measure of welfare improvement. CHAPTER 2 General Characteristics of Staple Production 1. The Staple Model of Development 2. Characteristics of a ŒGood¹ Staple 3. Demand - Technology 4. Consequences of Staple Domination 5. Forces Halting or Reversing the Staple 6. Staple¹s Production Function The student should be able to: i) define a staple; ii) list Canada¹s staples from the 15th century to the present; iii) describe the salient characteristics of a potential staple producing economy; iv) set out the alternative paths for development in an economy with those characteristics; v) describe the process of economic growth and economic development in a staple economy, including linkages; vi) describe changes in the international environment that affect the staple economy; vii) describe changes in the staple economy as the process of economic growth continues; viii)list some of the factors that may halt or reverse the development of a staple: changes in foreign demand, depletion, interference, home demand; ix) describe long-run changes in the staple economy if the export mentality and staple trap are avoided; x) list the characteristics of a good staple; xi) describe the implications for economic growth and development from some consequences of staple dominance: cyclical fluctuations, economic shocks, structural changes, scarcity of capital, government intervention, economic nationalism, ties with other countries, return cargo problem; xii) set out a staple¹s general production function, and show what its differences mean for economic growth and economic development. CHAPTER 3 The Early Staples: Renewable Natural Resource Exploitation The Exploitation of Natural Resources 1. Renewable Natural Resources - Harvesting 2. Property Rights: Common and Private 3. Spread of the Economy The student should be able to: i)define common property natural resources; ii)describe the reasons why some natural resources are common property resources: private costs, social costs, unlimited resources; iii)describe the implications of the above for the number of producers, harvesting of the natural resource, and depletion of the natural resource; iv) develop the model of sustained yield for a renewable natural resource, and use this model to construct total revenue, total cost, and profit maximization relationships; v) apply the above model to the spread of the harvesting of a natural resource from one geographical area to another; vi) describe the basic features of mercantilism as it applied to British and French North America to the early 19th century: objectives, internal unity, external power, bullionism, favourable trade balance, protectionism, the role of colonies. The Fisheries 1. Common Property Nature of the Resource 2. French and English Fishing Efforts: A Comparison 3. Triangular Trade Pattern The student should be able to: i) develop the North American fishing trade as a case study of both the staple model and a common property resource; ii) compare and contrast the English and French fishing trade, and describe how the differences influenced the economic growth and economic development of British and French North America; iii) describe the triangular trade pattern of the English fishing trade. The Fur Trade of New France 1. Supply and Demand - The Fur Trade 2. Production Function of the Fur Trade: Factor Prices 3. Westward Expansion - Over - Harvesting 4. Changing Factor Price Ratios and Technical Aspects of Production 5. Industry¹s Weakness During the French Regime The student should be able to: i) develop the pre-1763 North American fur trade as a case study of both the staple model and a common property resource; ii) describe the economic relationships between the Indians and the Europeans; iii) formulate the main features of the fur trade¹s production function, and relate it to the price of inputs; iv) describe the westward expansion of the fur trade and its companion over-harvesting of animals, which can be related to the sustained yield model of renewable natural resources; v) describe technological changes in the fur trade. Competition in the Fur Trade 1. North West Company 2. Hudson¹s Bay Company The student should be able to: i) describe the form that the competition between the North West Company and the Hudson¹s Bay Company took after 1763; ii) note the reasons for the eventual dominance of the Hudson¹s Bay Company by 1821. The Timber Trade 1. Baltic vs. British North American Timber Trade 2. British North America¹s Predominance in the British Market 3. Demand and Technology 4. Timber and Linkages The student should be able to: i)develop the British North American timber trade from 1763 to 1867 as a case study of both the staple model and a common property resource; ii) contrast the timber trade with the fur trade: transport requirements, relation to immigration and settlement, type of market; iii) describe the sources of demand for timber; iv) write a history of the growth of the timber trade that distinguished the four periods pre-1804, 1804-1815, 1815-1842, and 1842-1867, noting the relevant changes in demand and technology in each period; v) use the ŒCobweb¹ model to explain price instability in the timber trade. CHAPTER 4 Agricultural Development in Central Canada to 1914 The Agriculture of New France 1. Productive Factors and Agricultural Development 2. Agriculture¹s Slow Development 3. Extensive Cultivation The student should be able to: i) develop the pre-1763 agriculture of New France as a case study of the staple model (or perhaps of the lack of staple growth and development); ii) describe the objectives of agricultural development in New France: supply the fur trade, supply the fisheries and the sugar plantations, diversify the economy, a return cargo; iii) define economic efficiency as the value of outputs relative to the value of inputs, and use this definition as means of explaining agricultural change in New France; iv) describe the general characteristics of the seigniorial system, and relate it to the relatively slow growth of agriculture in New France; v) set out the relationship of the fur trade to agricultural development: their interrelationship and their separation; vi) describe the reasons for and the development of agricultural exports or staples in New France; vii) set out the reasons for the use of the long, narrow lot spreading back from the rivers; viii )describe some possible reasons why nucleated settlements were slow to be established in New France; ix) describe the economic and social position of the seignior relative to the habitants; x) explain the changes in the agriculture of New France in terms of economic efficiency, i.e., the value of inputs and the value of outputs: What products were produced? How were they produced? Stunted Agricultural Development 1. Seigniorial Lands - Shifting Inputs 2. Failure to Adopt 3. Eastern Townships - Marked Contrast The student should be able to: i) describe the changes in agriculture on the seigniorial lands after 1763 in terms of economic efficiency. ii) explain the reasons for the appearance of villages near the seigniorial lands; iii) describe the growth and decline of agricultural staples from the seigniorial lands; iv) compare agricultural practices of the French Canadian and English Canadian farmers, and describe the apparent reasons for the differences; v) develop the relationship between the timber trade and farming on the seigniorial lands; vi) describe the differences in agricultural output and methods between the seigniorial lands and the Eastern Townships, and explain how economic efficiency determined what outputs to produce and how to produce them; vii) describe the position of French Canadians in the Eastern Townships. Achieving an Agricultural Surplus 1. Upper Canada¹s Agricultural Production Function 2. Transport Improvements - Supply 3. Demand Forces - The Corn Laws: History and Effect 4. Canada - U.S. Agriculture Relations The student should be able to: i) relate wheat as a staple to the general requirements for its development in Canada West: (1) use and improvement of the St. Lawrence Route, and (2) serving of a market in Britain; ii) describe some general factors that would influence Canada West¹s or Ontario¹s early agricultural change: Land clearance, personal philosophy, inputs, the United States, physical characteristics; iii) describe the general pattern of settlement of Ontario during the period 1780 to 1850 as it relates to local accessibility, land quality, and speculation; iv) relate changes in Ontario¹s agriculture over the same period to economic efficiency; v) develop the Three Sector Trade Model; vi) explain how the Corn Laws before 1828 influenced the development of wheat as a staple from Ontario in terms of the Three Sector Trade Model; vii) describe the factors in the 1820s that worked to modify the Corn Laws, and the change in the Corn Laws in 1828; show using the Three Sector Trade Model how this change affected British North Americans. Rebellion, Unification and Annexation 1. Agricultural Discontent - Rebellious of 1837 2. Act of Union of 1840 3. End of the Corn Laws, Timber Preferences, Navigation Acts - Annexation Movement 4. Erie Canal and Drawback Legislation The student should be able to: i) use the Three Sector Trade Model to explain the negative and positive influences on wheat as a staple for Ontario in the 1830s: excellent British harvests, crop failure in Canada West, high Corn Law tariff, opening of the U.S. market; ii) compare the interests of farmers and merchants in the 1830s and 1840s; iii) describe the factors that improved the condition of agriculture in the 1840s: Erie Canal, Drawback Legislation, good harvests, U.S. market; iv) describe the reasons for the abolition of the Corn Laws in 1846. Innovations in Agriculture 1. Innovations and Efficiency - Costs 2. Classes of Innovations and Examples 3. Role of the Government The student should be able to: i) describe the changes in agricultural technology before 1867; ii) relate these changes to their affect on economic efficiency in Canada East and Canada West before 1867. CHAPTER 5 Commercial Policy Before Confederation Trade Barriers and Their Effects 1. Types of Commercial Policy and Tariffs 2. Effects of Tariffs: Consumption, Protective, Revenue, Production, Balance of Trade 3. Arguments for Tariffs The student should be able to: i) utilize the Three Sector Trade Model to show the effects of tariffs on prices and output in the protected sector, trade, tariff revenues and employment; ii) describe the infant industry argument for tariffs; iii) outline how tariffs might influence real GNP and real GNP per capita, and describe how some of the negative effects could be avoided; iv) relate tariffs to savings inflows for other countries, immigration and emigration, and transportation; v) develop the returns to scale argument for tariffs. Empire Trade and The Revenue Tariff to 1822 1. Trade¹s Imperial System: Navigation acts, Imperial Duties 2. Trade between Canada and the U.S., and With Third Parties The student should be able to: i) describe the general features of the Navigation Acts, and note their effects on British North America in the 18th and 19th centuries; ii) describe the relationship between England¹s tariff duties and the tariffs that British North America could impose; iii) describe how the actions of the United States during the revolution and up to 1815 affected the trade of British North America; iv) use the Constitution Act of 1791 as an example of a customs union. Internal Discontent and the British Betrayal 1. Upper vs. Lower Canada on Tariff Revenues 2. Agriculturists vs. Montreal Merchants 3. End of Trade Prohibitions The student should be able to: i) describe the basis of and the solution for the dispute between Upper and Lower Canada over the sharing of tariff revenues; ii) describe the disputes over trade and tariff policies that developed between the merchant class and the farmers: position in the British market, entry to U.S. products into British North American trade; iii) relate trade with the British West Indies to interests in the United States, Britain, the West Indies, and British North America. Free Trade and Protection, 1846-1866 1. British North American Free Trade Area 2. Reciprocity Treaty 3. Tariffs for Protection The student should be able to: i) describe the creation of free trade among some British North American colonies in the early 1850s, and note its consequences; ii) describe the main features of the Reciprocity Treaty of 1854, and note its effects on British North America¹s imports and exports: trade diversion and trade creation; iii) relate the Reciprocity Treaty of 1854 to British North America¹s economic growth and economic development from 1854 to 1866: What caused this growth and development? iv) argue the effects that the Reciprocity Treaty had on navigation of the St. Lawrence System, and compare that route to the Erie Canal; v) set out the history of British North America¹s import duties on manufactured goods from 1847 to 1867, and establish the reasons for protectionism; vi) describe the tariff-basis of Confederation that appeared in the 1860s. CHAPTER 6 Population Grown in Canada Introduction to Canadian Historical Demography 1. Supply and Demand as a Function of Population 2. Canada¹s Pattern of Population growth 3. Natural Increase and Net Immigration The student should be able to: i) describe how natural increase and net immigration determine an area¹s change in population; ii) set out French and British North America¹s population history up to 1867: rapid and slow growth periods; note the roles that natural increase and net immigration played in this history. Vital Statistics 1. Underlying Demographic Variables The student should be able to: i) describe the underlying changes that have been important in influencing birth and death rates; ii) note where possible the changes in these influences before Confederation. Natural Increase in New France 1. Natural Increase and Net Immigration The student should be able to: i) describe the factors that affected population change in New France. Population Movements: A Framework 1. Costs and Benefits of Migration: Pecuniary and Non-Pecuniary 2. Net Expected Returns of Migrating The student should be able to: i) define pecuniary and non-pecuniary determinants of migration; ii) establish a framework for population migration in terms of the expected gross return from migration and the expected net return from migration; iii) list some non-pecuniary costs and benefits of migration; iv) set out the conditions that are likely to cause more or less migration between geographical areas in terms of this framework. Immigration and Emigration before Confederation 1. History Within the Context of Net Expected Returns of Migrating 2. Changing Source of Canadian Immigrants The student should be able to: i) apply the general framework of migration to immigration to British North America prior to Confederation. CHAPTER 8 Capital Formation and Mobilization Introduction 1. Capital Formation: Capacity - Creating Effect and Income - Creating Effect 2. Uncertainty vs. Risk Primitive Capital Markets and Early Industry 1. Capital and the Early Staples 2. Place of internal Financing 3. Personal Finance: Growth Impediments The student should be able to: i) describe how the staple trades were financed; ii) describe the relationship between the early manufacturing enterprises and the financial control of their owners and financial agents. The Banking System 1. Reasons for Banks¹ Emergence 2. Banks¹ Role in Capital Mobilization: Direct and Indirect 3. Bankers ŒConservative¹ Posture The student should be able to: i) note the characteristics of British North America¹s financial system prior to the establishment of banks in the 1820s, and list the types of money; ii) describe the reasons why banks were established, including their effect on the economy through the so-called Cambridge Equation; iii) describe the growth of banks from the 1820s to Confederation in British North America, including the rivalry between merchants and farmers; iv) list and explain the implications of the principles of banking that were established in the first bank charters: legislative chartering, commercial banking, bank notes, branching, protection of the public; v) relate the experiences with Œfree¹ banking in the United States to British North America; vi) describe the financial relations between the governments and the banks: issuance of bank notes, holding of government securities, government notes, Bank Note Act of 1866; vii) note and describe the reasons for the appearance of non-bank financial intermediaries. CHAPTER 10 Transport: Investment in Infrastructure Economic Significance of Transport Improvements 1. Transport Improvements and Economic Development 2. Transport: The Extensive Margin 3. Indirect and Direct Benefits 4. Private and Social Returns The student should be able to: i) explain how transport improvements expand the extensive margin of settlement; ii) distinguish between private and social benefits and costs of transport; iii) use the Three Sector Trade Diagram to show the effects of transport improvement on output, prices, trade, etc.; iv) describe the indirect as well as the direct benefits in the form of linkages from transport change; v) relate in general transport improvements to economic growth and economic development. The King¹s Highway, 1763-1850 1. Economic Benefits - Non-Economic, Military Considerations 2. The First Road Network 3. Roads¹ Limitations as Transport The student should be able to: i) describe the development of through and feeder roads in British North America from the 1790s to the 1860s; ii) set out the relationship between the construction of roads and the role of the various governments; iii) describe the part that roads played in the economic growth and development of the Canadas; iv) note the limitations that roads had as transport improvements in the early 19th century. Gateway to the West: Canal Projects of Central Canada 1. Rationales for Improved Water Transport 2. St. Lawrence vs. Erie Routes 3. Aspects Affecting Construction and Canals¹ Impact 4. Montreal as an Entrepot - Failure of St. Lawrence Route 5. Canals¹ Social Savings The student should be able to: i) describe the relationship between the appearance of wheat and lumber as staples and the need for cheap transport, and describe the costs associated with adjusting to these new staples; ii) describe the impact that the construction of the Erie Canal had on British North America, and this canal¹s influence on canals along the St. Lawrence River; iii) set out the economic, geographic, and political obstacles to the construction of canals in British North America; iv) describe the construction, benefits, and problems from the Rideau Canal, the Welland Canal, and the St. Lawrence Canal System; v) describe the reasons why the British North American canals found it hard to compete with the Erie Canal after 1850; vi) relate the changes brought on by canals to the relationship between the merchants and the farmers. The Coming of the Railways 1. Montreal: A Metropolitan Centre 2. The First Railway Network 3. Railways¹ Success: Canadian and Foreign Trade 4. Governments¹ Role The student should be able to: i) describe the general policies for British North America¹s economic growth and economic development in the 1850s, and relate them to the need for transport changes; ii) list the main railways that were constructed in the 1850s; iii) describe the role of the government in railway construction: Guarantee Act, Municipal Loan Fund Act; iv) note the successes and the problems with British North America¹s railroad system at the time of Confederation.