--- canonical_url: "https://csls.ca/ipm-archive/ipm-issue-31/decomposing-multifactor-productivity-growth-in-canada-by-industry-and-province-1997-2014/" title: "Decomposing Multifactor Productivity Growth in Canada by Industry and Province, 1997-2014" author: name: "CSLS" url: "https://csls.ca/author/cslc/" date_published: "2026-07-13T07:40:55+00:00" date_modified: "2026-07-13T07:40:55+00:00" post_type: "ipm" summary: "" ipm_issue_period: - "Fall 2016" ipm_keyword: - "Canada" - "commodity prices" - "CSLS" - "decomposition" - "GEAD" - "industries" - "manufacturing" - "MFP" - "mining" - "oil and gas" - "provinces" ipm_research_theme: - "Productivity trends and comparisons" ipm_country_focus: - "Canada" featured_image: "https://csls.ca/wp-content/uploads/2026/06/IPM_50_banner.webp" status: "publish" --- # Decomposing Multifactor Productivity Growth in Canada by Industry and Province, 1997-2014 Canonical URL: https://csls.ca/ipm-archive/ipm-issue-31/decomposing-multifactor-productivity-growth-in-canada-by-industry-and-province-1997-2014/ # Decomposing Multifactor Productivity Growth in Canada by Industry and Province, 1997-2014 [Download full PDF article](https://csls.ca/wp-content/uploads/2026/07/IPM-Issue-31-7-Calver-Murray.pdf) Cite this article × Cite this article as: Calver, Matthew, and Alexander Murray. 2016. “Decomposing Multifactor Productivity Growth in Canada by Industry and Province, 1997-2014.” International Productivity Monitor, No. 31 (Fall 2016): 88–112. https://www.csls.ca/ipm-archive/ipm-issue-31/decomposing-multifactor-productivity-growth-in-canada-by-industry-and-province-1997-2014/ ## Authors: - Matthew Calver Centre for the Study of Living Standards (CSLS) - Alexander Murray Centre for the Study of Living Standards (CSLS) ## IPM Issue 31 Fall 2016 pp. 88–112 ## Related IPM articles [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/) [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/) [De-industrialization and the Great Productivity Slowdown: What Comes Next? 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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/) [Accounting for the Decline of Canada’s Real GDP Per Capita since Mid-2022 Philip Smith Spring 2024 | IPM Issue 46 | pp. 83–100](https://csls.ca/ipm-archive/ipm-issue-46/accounting-for-the-decline-of-canadas-real-gdp-per-capita-since-mid-2022/) ## Abstract ## Résumé EN FR Copy link Email LinkedIn Between 1997 and 2014, multifactor productivity (MFP) in Canada’s business sector industries grew at an annual rate of 0.02 per cent per year – essentially zero. In this article, we decompose aggregate MFP growth into contributions by industry and province. Two sets of results are presented: one based on the generalized exactly additive decomposition (GEAD) and one based on the CSLS decomposition. The two decomposition methods lead to very different conclusions. The GEAD suggests that the reallocation of inputs to the mining and oil and gas extraction industry in the oil-rich provinces were the primary drivers of MFP growth in Canada while the manufacturing sector, concentrated in Ontario and Quebec, dragged MFP growth down. The CSLS decomposition suggests precisely the opposite: mining and oil and gas was the main hindrance to Canada’s MFP performance while manufacturing was the major driver of MFP growth. The disagreement between the two methods is primarily attributable to the fact that the large increase in commodity prices (especially oil prices) over the 1997-2014 period increases the mining and oil and gas industry’s contribution to MFP growth according to the GEAD while the CSLS decomposition does not treat such relative price effects as contributors to productivity growth. MFP growth is often treated as synonymous Multifactor productivity (MFP) is defined as Entre 1997 et 2014, la productivité multifactorielle (PMF) dans les industries du secteur des entreprises au Canada a progressé à un taux annuel de 0,02 % — essentiellement zéro. Dans cet article, nous décomposons la croissance globale de la PMF en contributions par industrie et province. Deux ensembles de résultats sont présentés : l’un fondé sur la décomposition générale exactement additive (DGEA) et l’autre fondé sur la décomposition du CSLS. Les deux méthodes de décomposition conduisent à des conclusions très différentes. La DGEA suggère que la réaffectation des intrants vers l’industrie de l’extraction minière, pétrolière et gazière dans les provinces pétrolifères était le principal moteur de la croissance de la PMF au Canada, tandis que le secteur manufacturier, concentré en Ontario et au Québec, a freiné la croissance de la PMF. La décomposition du CSLS suggère précisément le contraire. 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