North America

Go East, Young Canuck!

Canada’s Atlantic region, where lives 30 percent of the Canadian population in five of the country’s ten provinces (Quebec*, Nova Scotia, New Brunswick, Newfoundland, and PEI), has had slower population and GDP growth than central Canada and western Canada in recent times.

(*I’m including Quebec in “Atlantic Canada” here. This is for three reasons: first, Quebec is  geographically an Atlantic province; Quebec City is an Atlantic city. Second, Quebecers has shared in the Atlantic trend of relatively low population and GDP growth. Third, the French-speaking area of Canada in a sense spills over into New Brunswick, where about a third of people speak French).

Atlantic Canada’s slower growth has been the result, more or less, of four factors: climate (Quebec’s winters are cold, the Maritimes snowy), commodities (fossil fuels are mostly in western Canada); language (much of Atlantic Canada’s population does not speak English well), and location (Atlantic is relatively far from East Asia or the US).

can-us 50 land:water

average snow in canada

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Population and GDP Growth Ahead? 

I’m sorry, but I got real lazy here. So I’m just going to make pie-in-the-sky predictions, in point form:

  1. Migration and EnergyWith fossil fuel prices low today:— the Maritimes (apart from Newfoundland) benefit, as they tend to be the most dependent on fuel imports among Canadian provinces
    — Maritimers may move home from western Canada
    — Migrants from Romance-language developing economies and the Arab world, which depend heavily on energy and other commodity exports, may move to Quebec or to New Brunswick. This is particularly true given current politics in the US (where many do not want more immigration from Latin America), France (where many don’t want Muslim immigration), Veneuela (a country of 32 million people, in turmoil right now), Algeria, Libya, Angola, DRC, and Brazil
    — Migrants need affordable housing; Ontario and BC don’t have it, Atlantic Canada does
    — Migrants need employment; France, Spain, Italy, Portugal and Belgium don’t have it
    — Demographics: whereas today most of the world’s people of prime emigrating or studying-abroad age (20-40 years old) in the world are East or South Asian, over the next decade or two the biggest growth in this category by far will be in Sub-Saharan Africa. Much of this, in turn, will be in Atlantic countries (notably Nigeria), many of which speak English or French.
    — In the Americas, the biggest relative growth in 20-40 year olds will be in Haiti (pop. 11 million)
    — Even Romania, a Romance-language country with a population of 20 million, is an oil-exporting economyAtlantic_Ocean_laea_relief_location_map

2. Trade and Technology

— Brexit: England and/or Scotland and/or Ireland may look west to its ex-colonies in the Maritimes for new trade (or travel) relationships
— Trump: the Republicans have brought some uncertainty to NAFTA, and also seem poised to help keep energy prices low by allowing the US fossil fuel boom to continue. Atlantic Canada is less dependent on trade with the US than Ontario is, and less dependent on high fuel prices than western Canada is
— New Fur Trade: Europe is looking for commodities in order to wean itself off of Russia and the Arab world, and ports in Atlantic Canada may be able to provide it with the supplies to do so. In recent decades, most Canadian trade has been along north-south lines, a result of the significant barriers that are the Rockies (especially in winter), northern Appalachians (especially in winter), and the Canadian Shield’s lakes/rock formations/Great Lake Snow-belts. New technologies, however, notably autonomous trucks (or at least, “smarter” trucks) may help to overcome these barriers, allowing for more east-west trade
— Meanwhile, trade with Asia is unlikely to grow relatively quickly like it did in recent decades, given that Asian growth is shifting more from the northeast (Japan, South Korea, coastal China), which is relatively near western Canada, to the south and west (India, Southeast Asia, inland China) which is not so easily accessible from western Canada. Western India, in fact, is several thousand km closer to Halifax by sea than eastern India is to Vancouver
— Autonomous ships, aircraft: small autonomous ships, combined with climate change, might open up new North Atlantic sea lanes (Northwest Passage, Northeast Passage). Autonomous aircraft, similarly, might help open up the aerial Northwest Passage (by air, St. John’s-to-Beijing is only 20-25 percent further from than Victoria-to-Beijing). Autonomous cargo planes, when combined with modern precision airdrop technology, may also allow the Maritimes to benefit from being located along the aerial routes between North America and Europe — not entirely unlike how, in the pre-jet age, cities like Gander benefited from these routes
— If North America is to move in a direction away from fossil fuels, it will need abundant energy alternatives, as well as abundant energy storage to support intermittent sources like solar and wind. Quebec’s hydro industry is one of the world leaders in electricity production and storage
— If robots/autonomous vehicles become common, then the amount of energy that is in demand in the wee hours of the night will skyrocket, since robots don’t need sleep. This will benefit energy production that today cannot be turned off at night, such as nuclear and (in many cases) hydropower, in contrast to gas plants or, especially, solar. Outside of China and Russia, which produce prodigous amounts of nuclear and hydro but an even more enormous amount of fossil fuels, the leaders in hydro and nuclear are Atlantic economies: Brazil, France, Scandinavia, and the eastern half of Canada
— E-commerce: in a world of globalizing digital interaction, a region bilingual in both English and a Romance language might be in a good position
— Robotic factory workers: the Maritime provinces have excellent, abundant natural harbours to use as ports, but relatively small populations and, thus, small labour forces. Robots could, pehaps, change this equation, making ports (and energy) a more decisive asset

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Source: United States Geological Survey

3. Climate and Tourism

— driving in snow or rains, both of which Atlantic Canada gets a lot of, may become much safer and more comfortable than in the past (good, among other things, for the 35 km drive between Halifax and the Airport)
— Atlantic Canada has an enormous amount of waterfront land. With people perhaps being able to spend more time in the countryside, as a result of automation (doing jobs for people), the Internet (e-commuting), and demographics (Baby Boomers cutting down their work hours), this waterfront land could help in tourism
— with more flexibility (because of technology), people from Canada, the US, and Latin America can become snowbirds: summering in Atlantic Canada and wintering down south
— cross-country skiing boom will continue over the next ten years, as Baby Boomers enter their 60’s and 70s
—Much of Atlantic Canada is islands and peninsulas. Airplane travel may become cheaper if autonomous planes really do become a reality — or if it becomes easier to become a pilot because of high-tech modern flight simulators. Traveling by boat may become easier if people get more time on their hands, if technology increases safety, and if technology can address sea-sickness

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The Maritimes likes its PM’s to be handsome, apparently

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North America

Should Hockey Fans Be Keynesians?

One of the most common things NHL players tell the media during the playoffs is that, when on the road, they want to play well during the first period in order to “take the fans out of the game early”.

If we assume that the players are correct in thinking that the fans can have strong influence over the game — even though, notably, home-team advantage has been quite a bit less significant in the NHL than in the NBA, and is arguably more to do with biases in officiating than anything else  — it begs the question of whether some teams’ fans are better at cheering than others.

Usually most of the focus here gets put on sheer loudness: the louder the fans, the better.  In this year’s playoffs, for example, sportscasters have been talking a lot about how the Rangers’ struggles at home may be due in part to renovations that have made Madison Square Gardens a quieter arena to play in than it used to be.

But what might, perhaps, be lacking in these discussions is a focus on the timing of fans’ cheering. In the NHL, most cheering tends to occur when the home team is already playing well. When a team is doing poorly, however, it is more likely to hear only a brief, classless “Refs You Suck” chant, rather than the more sustained, energizing, and joyous “Go Leafs Go!”

It is not, or at least it appears not to be, the fans as a whole who tend to shift the momentum in the game. Rather it seems more often to be individual achievements that do so: a timely goal to get the home team back in the game, a big hit being landed or power play started, or a super-determined (and probably drunk) fan who just wont give up cheering until everybody sitting around him — and then, ultimately, the entire arena — joins in too.

The way fans cheer may be the worst nightmare of the honest, god-fearing Keynesian. Rather than provide stimulus during teams’ recessions, and restraint during their boom times, fans cheer when teams are already playing well, and are often quiet when things look grim.

This raises questions that are usually more associated with economics and politics than hockey. Can stimulus lead to mistakes borne of overconfidence? Is stimulus always equally good, or does it succumb to diminishing returns — and if so, how soon after it begins? And how much better are some governments (or fans) than others at doling out stimulus at the ideal time?

Obviously, these are contested, and more or less unsolved, or even insoluble, questions in economics. In sports, though, we cannot even begin to approach the question, since nobody (as far as I know) has gathered the data that would be necessary to make a start of it. If we want to know more — and yes,  I admit it: this is obviously not really an issue of burning importance — we’re going to need a hockey-loving economist who possesses the skill and resources to do so.

Malcolm Gladwell, if you’re out there somewhere, get to work.

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North America

Captain Compromise: An All-Star Weekend Mini-Tournament in South Korea

Like many who heard the hockey news last week, I feel the decision not to have NHL players attend next year’s Olympics is bittersweet.

On the one hand, the Olympics should, of course, almost by definition, feature the best athletes in the world.

As a Leaf fan in particular, I can’t help but lament the storylines that may go untold. Matthews and Van Riemsdyk getting even with the Russians for hacking John Podesta’s e-mails. Frederik Andersen standing on his head so much that the Danes end up acheiving their first-ever trip to the podium, beating their historic rival Sweden in a 1-0 octuple-overtime bronze medal game. Or even Zach Hyman, leading an Israeli team manned almost entirely by North American Jews, teaching them how to scour the boards, kill off penalties, and desperately try to help Matthews convert.

Who knows what wild Olympic action we will miss!

On the other hand, one must also respect the owners’ inclination to spend tons of their own money to earn tons more money within a free society. Why should they risk their stars being injured? And anyway, it will be exciting to see more amateur players—and Datsyuk—compete instead.

Also, it’s just sports, so who cares?

Well, alright, I do care. And so do plenty of other sports-crazed hockey lovers, who would also prefer the best players to play. Really, apart from the owners, and Gary Bettman, and some of the stars in the KHL, SEL, and OHL, and their families, and perhaps Kim Jong Un, there isn’t anybody who stands to benefit from players like Kane, Karlsson, Crosby and Ovechkin staying home.

Luckily, there may be a compromise available that would please both owners and fans, which could be used if the NHL does end up going through with the prohibition it announced earlier this week.

The compromise is this: All-Star Weekend in Daegwallyeong-myeon.

It’s pretty simple actually. Instead of only having one hockey category in the Olympics, in 2018 you have two: European Hockey and American Hockey. The European Hockey event will work the same way Olympic hockey tournaments always do, only without any active NHL players in it.

The American Hockey event, however, will be a much shorter, 2-day tournament, involving just 8 teams and playing by NHL rules (smaller ice, hybrid icing, etc. ). The teams will be Canada, the US, Russia, Sweden, Finland, Czech Republic, Slovakia, and World. (The World team might in fact have the fewest NHL players on its roster…though solid goaltending). The twin Hockey events will not be held on the same week, so non-NHL star players will be able to compete in both.

The 2-day, 8-team American Hockey event will work as follows. On Day 1, two rounds will be held, each round consisting of one 20-minute hockey game, plus sudden death overtime if needed. The first overtime will be 5-on-5 for 20 minutes, the second overtime 4-on-4 for 5 minutes, and all subsequent overtimes 3-on-3 for 5 minutes at a time. There will be no friggin’ shootouts.

It is likely that, at the end of Day 1, the four advancing teams in the tournament will each have played around 40-90 minutes of hockey; probably closer to 40 minutes. The four losing teams could easily wind up playing only 20 minutes of hockey. Matchups for Day 1 will be selected by lottery.

On Day 2 of the event, the final round will be held: the Bronze Medal Game and Championship Game. Both games will be played by playoff rules: 60 minute regulations and 20-minute 5-on-5 OT’s.

There you have it. The whole thing is over in one action-packed weekend. Canada’s stars grab gold, then head back home to celebrate before the jet-lag even has time to kick in. The players are not so likely to get injured, since, barring a wild series of sudden death overtimes, teams in the event will only play 20-200 minutes of hockey. And fans will not be forced to watch some poor athlete from Latvia or Slovenia try to defend Connor McDavid—or catch a last, peripheral glimpse of Brent Burns’ beard flying at them if they finally do succeed in carrying the puck over the blue line.

So, nu, what do you think? Nothing like a good compromise, eh?

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