Summary

Canada is one of the richest countries in the world. It stands above most countries in the Americas. It is also noticeably poorer than its closest neighbor, the United States, despite considerable geographic similarity. These two facts have been true since as early as the 17th century. Why? An understanding of the historical path of Canada’s economic growth can be acquired by focusing on three important gaps in living standards within Canada: First Nations versus the rest of Canada, French Canadians versus English Canadians, and Atlantic Canada versus the rest of Canada. These three gaps allow an understanding of the crucial role of institutions in determining why Canada is rich on a global perspective and why it is poorer than the United States. However, explanations as to why Canada grew faster than Latin America are more speculative.