Competition

Competitive markets push firms to innovate, cut costs, and treat customers well. Protected markets let incumbents coast instead, and productivity stagnates as a result. Canada has let concentration take hold in many of the sectors where competition would matter most – postal service, telecommunications, dairy, and financial services – insulating established players from many of the pressures that drive real productivity gains, whether they come from new rivals, new technology, shifting consumer preferences, or trade agreements. Exposure to competition, foreign and domestic, is one of the strongest levers Canada has to raise productivity, and in several of these sectors that lever remains underused.