The paper examines the industry characteristics that are related to the shifts in competitiveness, measured as the relative common-currency price ratios between Canadian and US manufacturing prices. We find that relative input costs and relative productivity growth are the two most important...

The paper examines whether arbitrage tends to equalize commodity prices for internationally traded homogenous products. It also investigates whether the increasing integration of North American markets has reduced price differences over time, and tests the validity of the so-called Law of One...

The paper examines the possible explanations for deviations from purchasing power parity (PPP) between Canada and the United States in the 1980s and 1990s. The Balassa-Samuelson (B-S) model is used as the basis for the empirical exercise. In the B-S model, where PPP is assumed to hold for...

The paper investigates the law of one price (LOP), using 84 Canada/U.S. manufacturing prices over 1961–1996.We find that while there is a long-run relationship between Canadian and U.S. prices, industries vary in terms of adherence to the LOP. In industries with higher degree of market...