Livio Di Matteo is professor of economics at Lakehead University. This column was originally published in January, 2010.
While it is simplistic to believe that history repeats itself, economic history is shaped by cyclical demographic and economic factors. Ontario’s economy, despite its current lethargy, is poised for a boom reminiscent of what shaped the province at the dawn of the 20th century.
During the late 19th century, Ontario’s economy was laid low by a global economic slump. Between 1891 and 1901, Ontario’s population growth crawled to a virtual halt and out-migration of its young people to the United States became a chronic lament.
Ontario’s economy was saved during the early 20th century by two booms
that fuelled its manufacturing sector’s growth and ensured that Toronto
became the financial centre of Canada.
Ontario’s economy was saved during the early 20th century by two booms that fuelled its manufacturing sector’s growth and ensured that Toronto became the financial centre of Canada. The first, the prairie settlement boom, saw hundreds of thousands of European settlers flock to the Prairies and form a market for consumer goods produced by central Canadian industry. The second was the forestry and mining resource boom of Ontario’s northern frontier, which generated inputs into southern Ontario industry, created Toronto’s role as a financial centre and created a lucrative source of provincial government revenue via enormous resource rents and royalties.