Further Reflections on Alberta's Capital Spending and Finance: Comments on the Dodge Report to the Government of Alberta, October 2015

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  • David Dodge, former Governor of the Bank of Canada, submitted a report to the Government of Alberta in October 2015 on provincial capital spending and finance. That report was incorporated into the October budget documents. There are many valuable insights and recommendations in the report. However, a major premise of the report is that Alberta is undersupplied with provincial government sector capital and, so, Dodge recommends that the province should increase its capital stock to the equivalent of 16 per cent of its GDP (a benchmark based on comparison of levels in the other five largest provinces – Quebec, Ontario, Manitoba, Saskatchewan and British Columbia). To achieve that benchmark, Dodge’s simulations suggest that the province could reasonably borrow to finance much of the additional capital spending required. This paper presents an investigation into whether the 16 per cent benchmark is appropriate and whether the implied debt is “moderate”.

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    Conference/Workshop Presentation
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    Attribution 4.0 International