--- canonical_url: "https://csls.ca/ipm-archive/ipm-issue-20/canadas-potential-productivity-and-output-growth-a-post-crisis-assessment/" title: "Canada’s Potential Productivity and Output Growth: A Post-Crisis Assessment" author: name: "CSLS" url: "https://csls.ca/author/cslc/" date_published: "2026-07-13T07:31:43+00:00" date_modified: "2026-07-13T07:31:43+00:00" post_type: "ipm" summary: "" ipm_issue_period: - "Fall 2010" ipm_keyword: - "aging" - "Canada" - "capital accumulation" - "financial crisis" - "growth accounting" - "IMF" - "post-crisis" - "potential output" - "TFP" ipm_research_theme: - "Productivity trends and comparisons" ipm_country_focus: - "Canada" - "International" featured_image: "https://csls.ca/wp-content/uploads/2026/06/IPM_50_banner.webp" status: "publish" --- # Canada’s Potential Productivity and Output Growth: A Post-Crisis Assessment Canonical URL: https://csls.ca/ipm-archive/ipm-issue-20/canadas-potential-productivity-and-output-growth-a-post-crisis-assessment/ # Canada’s Potential Productivity and Output Growth: A Post-Crisis Assessment [Download full PDF article](https://csls.ca/wp-content/uploads/2026/07/IPM-Issue-20-1-Estevao-Tsounta.pdf) Cite this article × Cite this article as: Estevão, Marcello, and Evridiki Tsounta. 2010. “Canada’s Potential Productivity and Output Growth: A Post-Crisis Assessment.” International Productivity Monitor, No. 20 (Fall 2010): 3–21. https://www.csls.ca/ipm-archive/ipm-issue-20/canadas-potential-productivity-and-output-growth-a-post-crisis-assessment/ ## Authors: - Marcello Estevão International Monetary Fund - Evridiki Tsounta International Monetary Fund ## IPM Issue 20 Fall 2010 pp. 3–21 ## Related IPM articles [Efficiency Adjustment of Hours Worked: Two Possible Modifications of a Jorgensen Production Model Barbara Fraumeni Fall 2025 | IPM Issue 49 | pp. 103–115](https://csls.ca/ipm-archive/ipm-issue-49/efficiency-adjustment-of-hours-worked-two-possible-modifications-of-a-jorgensen-production-model/) [The Relationship between Efficiencies Defenses for Mergers and TFP Growth Robin Shaban Fall 2025 | IPM Issue 49 | pp. 82–102](https://csls.ca/ipm-archive/ipm-issue-49/the-relationship-between-efficiencies-defenses-for-mergers-and-tfp-growth/) [Labour Productivity as a Measure of Technological Change Ulrich Kohli Fall 2025 | IPM Issue 49 | pp. 64–81](https://csls.ca/ipm-archive/ipm-issue-49/labour-productivity-as-a-measure-of-technological-change/) [Appendix: Variable Definitions and Country/Sector Coverage for Regulatory Reform Analysis Gilbert Cette, Jimmy Lopez, Giuseppe Nicoletti, Océane Vernerey Fall 2025 | IPM Issue 49 | pp. 1–18](https://csls.ca/ipm-archive/ipm-issue-49/appendix-variable-definitions-and-country-sector-coverage-for-regulatory-reform-analysis/) [The Potential Impact of Pro-competitive Regulatory Reforms on Productivity and Growth in Canada Gilbert Cette, Jimmy Lopez, Giuseppe Nicoletti, Océane Vernerey Fall 2025 | IPM Issue 49 | pp. 3–40](https://csls.ca/ipm-archive/ipm-issue-49/the-potential-impact-of-pro-competitive-regulatory-reforms-on-productivity-and-growth-in-canada/) [IPM Issue 49 Editors’ Overview Andrew Sharpe, Bart van Ark, Paul Schreyer Fall 2025 | IPM Issue 49 | pp. 1–2](https://csls.ca/ipm-archive/ipm-issue-49/) [The UK Productivity Slowdown: A Review of Timing, Magnitude, and Drivers Josh Martin Spring 2025 | IPM Issue 48 | pp. 1–34](https://csls.ca/ipm-archive/ipm-issue-48/the-uk-productivity-slowdown-a-review-of-timing-magnitude-and-drivers/) [Appendix: UK Productivity Growth Rates Across Data Vintages and Studies Josh Martin Spring 2025 | IPM Issue 48 | pp. 65–73](https://csls.ca/ipm-archive/ipm-issue-48/appendix-uk-productivity-growth-rates-across-data-vintages-and-studies/) [Opportunities and Risks of Artificial Intelligence for Productivity Francesco Filippucci, Peter Gal, Katharina Laengle, Matthias Schief, Filiz Unsal Spring 2025 | IPM Issue 48 | pp. 1–26](https://csls.ca/ipm-archive/ipm-issue-48/opportunities-and-risks-of-artificial-intelligence-for-productivity/) [How Does Industrial Policy Impact Output, Hours and Productivity? The Canadian Experience Tim Sargent Fall 2024 | IPM Issue 47 | pp. 39–53](https://csls.ca/ipm-archive/ipm-issue-47/how-does-industrial-policy-impact-output-hours-and-productivity-the-canadian-experience/) ## Abstract ## Résumé EN FR Copy link Email LinkedIn This study investigates the impact of the current financial crisis on Canada’s potential GDP growth. Using a simple accounting framework to decompose trend GDP growth into changes in capital, labour services, and total factor productivity, we find a sizeable drop in Canadian potential growth rate in the short term. The estimated decline of about 1 percentage point originates from a sharply decelerating capital stock accumulation (as investment has dropped steeply). However, over the medium term, we expect Canada’s potential GDP growth to gradually rise to around 2 per cent, below the pre-crisis growth rate, partly reflecting the effects of population aging. RÉSUMÉ L’étude examine l’impact de la crise financière actuelle sur la croissance du PIB potentiel du Canada. Au moyen d’un cadre comptable simple servant à décomposer la croissance du PIB à long terme selon les changements dans le capital, les services de main-d’œuvre et la productivité totale des facteurs, nous constatons une baisse appréciable du taux de croissance potentiel du Canada à court terme. La diminution estimée d’environ un point de pourcentage s’explique par la forte décélération de l’accumulation du capital-actions (étant donné que les investissements ont beaucoup chuté). Toutefois, à moyen terme, la croissance du PIB potentiel du Canada devrait s’élever progressivement à environ 2 %, en deçà du taux de croissance avant la crise, partiellement en raison des effets du vieillissement de la population. P OLICY MAKERS NEED ACCURATE ESTIMATES of Cette étude examine l’impact de la crise financière sur la croissance du PIB potentiel du Canada. À l’aide d’un cadre comptable simple pour décomposer la croissance tendancielle du PIB en variations du capital, des services de la main-d’œuvre et de la productivité multifactorielle, nous observons une baisse notable du taux de croissance potentiel canadien à court terme. Le recul estimé d’environ 1 point de pourcentage est attribuable au fort ralentissement de l’accumulation du stock de capital (à la suite d’une forte chute de l’investissement). Cependant, à moyen terme, nous prévoyons que la croissance du PIB potentiel du Canada augmentera progressivement pour atteindre environ 2 %, en deçà du taux de croissance d’avant la crise, en partie en raison des effets du vieillissement de la population. [Download full PDF](https://csls.ca/wp-content/uploads/2026/07/IPM-Issue-20-1-Estevao-Tsounta.pdf)