Volume 58, numéro 4, décembre 1982

EN :

This study analyzes the causes of unemployment fluctuations in Quebec since 1962 according to age and sex. The author distinguishes between the cyclical and structural component of unemployment rates. Referring to the expansionary peak of 1966, he establishes that 50% of the rise in the female unemployment rate is of structural matter, whereas 80% of the rise in the youth unemployment rate comes from the demand deficiency.

The structural factors appear in two groups of variables: the socio-demographic variables (the baby boom and the rise in the female participation rate) and the policy variables which include the generosity index of the unemployment insurance program, the relative minimum wage, and the relative earnings in the public and parapublic sector. This study shows that the policy factors have played a prominent part inside the structural component of unemployment rates during the 70's, especially for young men. Nearly 60% of the increase in the global structural unemployment rate since 1962 has been attributed to the government policies analyzed in this study, and nearly 30% has been issued solely from the government wage policy.

For the author, the most important step to jump in order to improve the employment situation in Quebec remains the elimination of the three percentage points of purely cyclical unemployment that persisted in 1980 and 1981 (7 to 9 in 1982). The second one would be to bring back the average earnings in the public and parapublic sector closer to the average earnings in the private sector. The introduction of these policies coupled with the demographic forecast of StatisticsCanada would give a better employment surrounding for youth, but would only slow down the increase in the female unemployment rates.

EN :

The neo-classical economic theory of the consumer behavior defines a utility function in terms of a global number of characteristics a product process or the result of several purchase activities. Every consumer can be in the context of aninefficient consumption function if the choice of the product bought doesn't fit with the state of preferences for the characteristics of this product. Thus, an efficient consumption function requires an adequate level of information that the mechanics of the market performance doesn't guarantee as well as for the consumption function as for the production function.

In this paper, the consumer information processing limit is exposed showing an important gap between the preferred and memorized information by the consumer during the decision process. The concept of pre-processed information proposed could possibly improve the efficiency of the consumption function.

EN :

Even though the Canadian Great Depression was one of the worst in the Western World, there are no recent articles where the phenomenon is analyzed as a whole. In this paper, the Interwar business cycles are analyzed in the context of amacroeconomic model with monthly data. The model features the specification of the money supply process, of the balance of payments and of the interaction between these variables.

The results of estimation of the model indicate that Canada followed the US in its depression because it adhered too closely to the rules of the GoId Standard. Canada should have depreciated its currency at least to the extent of the depreciation of the pound sterling with respect to the US dollar. The results also indicate that the Finance Act did not play the important role that was assigned to it in the literature (Courchene, 1969).

EN :

In this study, a cardinal and continuous measure of the default risk of mortgage loans is proposed, in departure from past studies where that risk was measured by dichotomous or categorical variables. The cardinal and continuous measure of risk is obtained by use of the canonical factor analytic technique. The unique factor of risk is a linear combination of the rate of return on equity, of the break-even rental income and of the vacancy rate of the property, and also of the relative term of the mortgage loans. It is found that the default risk of mortgage loans is well explained by the attributes of the property and of the neighbourhood, as well as by the location and the mortgage ratio. Furthermore, the buyer seems to incur hidden transaction costs which increase his risk level over that observed of the seller.

EN :

This paper examines in the framework of the asset pricing theory how the internationalization of banking operations has influenced the returns and the risk of Canadian chartered banks.

Banking statistics reveal that in the last decade the Canadian banks have greatly increased their foreign operations. These statistics also indicate that the development of international banking operations has been more remarkable than that of domestic banking operations. Contrary to some banks' claims, our evidence reveals that average returns on foreign operations have been inferior to those obtained on purely Canadian operations. Moreover, in conformity with the asset pricing theory we have found that the systematic risk of international operations is smaller than that of domestic operations. Our results suggest that Canadian chartered banks have reduced their overall risk in internationalizing their operations.

EN :

After an examination of the various forms of income tax sharing in federal countries, the paper summarizes the arguments in favour of fiscal harmonization and the means of achieving it. Finally it raises objections to both the objective of fiscal harmonization and the need to impose it.

Imposed harmonization appears to be a source of monopolization that increases the discretionary power of the public sector over the citizen by facilitating tax collection. It works against economic efficiency which requires preserving the onerous character of taxation. However, harmonization may simply be the spontaneous result of the desire of government to minimize the inefficiency costs of their taxes. For example, regional governments avoid excessive differentiations in corporate taxes to avoid scaring off business.