Industry News // Statistics Canada releases methodology for estimating changes to North American trade patterns



Study: Estimating the effect of changing Canada/United States border costs on North American trade patterns and expenditures – detailed methodology


Statistics Canada recently completed a report on the methods used for estimating the effect of changing Canada-US border costs on North American trade. This paper is a follow-up to a previous report that provided detailed results of the study. The paper discusses in greater detail how Statistics Canada used its Surface Transportation File (STF), United States (US) domestic trade data, and a gravity trade model framework to study trade flows among 201 Canadian and United States regions for 2012. The paper also highlights a number of desirable properties of the Poisson Pseudo Maximum Likelihood (PPML) estimator, such as robustness to heteroscedasticity, the ability to hand zero-valued trade flows, and how the estimator simplifies the estimation of general equilibrium effects by satisfying adding-up constraints.

A large body of research has estimated average bilateral border costs, the combined effect of tariff and non-tariff barriers, indirectly by applying the gravity trade model framework, with border costs usually expressed as a tariff rate equivalent. Recent economic studies using this approach suggest further research is needed to accurately estimate these border costs, with concerns raised over the limited information on trade flows found in studied datasets. Geographic aggregation, to national levels or sub-national levels like provinces or states, has been found to introduce upward bias in the estimated border costs. This issue was addressed by another recent Statistics Canada study (Bemrose, Brown and Tweedle 2017), which used highly detailed trade data from the Surface Transportation File (STF).


The Gravity Model

Gravity models of trade originated with the preposition that bilateral trade flows should be increasing with the economic sizes of trading partners, and decreasing in their distance. The seminal work of Anderson and van Wincoop (2003) provided the first of many theoretical justifications for the gravity model, which showed that in addition to size and proximity, gravity models should also incorporate “multilateral resistance” terms to capture the influence of other trading partners. The gravity model for exports from location i to j (Xij) can be written as:

where Πi and Pj are the multilateral resistance terms, Yi is total output for location iEj is location j’s total expenditures on goods and services from all locations, tij is the bilateral trade cost, and −ε is the trade cost elasticity.



The STF was built from shipping records to measure domestic trade between detailed locations within Canada and between the United States and Canada. This dataset was combined with US Commodity Flow Survey (CFS) data to produce trade flow data among 201 comparable Canadian and United States regions for 2012. The resulting dataset is one of the most geographically detailed trade datasets available for measuring the average cost of the Canada-US and provincial borders.

Finer geographic detail should provide better estimates of average shipping distances between economic regions, and make intraregional trade costs more homogeneous across geographical units. Previous studies have suggested that measurement errors in distance and large differences in intraregional trade costs can cause substantial bias in estimated border costs. Sub-State and Sub-Provincial geographies were created for this study using the CFS’s division of states into metropolitan and non-metropolitan (MA/non-MA) areas, and the aggregation of STF trade flows into Economic Regions (ERs) comparable in size to the US MA/non-MA geography.

Most research is limited to using great circle distances between arbitrary points within trading areas. These measures often mischaracterize the distance goods traded between regions actually travel. The STF and CFS allow the derivation of network distances that more accurately reflect the origins, destinations and journeys goods can be expected to take.



The gravity model has traditionally been estimated by taking the natural log and using ordinary least squares (OLS). However, Silva and Tenreyro (2006) show that this approach leads to biased estimates in the presence of heteroskedasticity due to the retransformation problem. The authors suggest estimating the gravity equation in multiplicative form using Poisson Pseudo Maximum Likelihood (PPML) estimation. PPML is robust to heteroscedasticity and has the added benefit of being able to accommodate zero-valued observations for the dependant variable (i.e. zero-valued trade flows). Fally (2015) shows that importer and exporter fixed effects estimated by PPML will always satisfy the adding-up conditions for the multilateral resistance terms, simplifying the process of estimating full general equilibrium effects of changes to border costs.

For the econometric specification, the functional form of the multilateral resistance terms need not be identified to estimate the gravity model, since these terms can be replaced with importer and exporter fixed effects. Proxy variables are used to capture bilateral trade costs, which include distance and dummy variables that indicate if a provincial border, state border, or the Canadian-US border separates the two regions. In much of the literature, the trade cost of exporting from region i to region j is assumed to be a log-linear function of distance. This assumption is likely problematic when using a fine geographic breakdown, as trade involves both fixed and variable transportation costs. To account for possible nonlinearities in the effect of distance, a spline function is defined over various ranges of distance.



The results suggest that the tariff rate equivalent for the Canada-US border is in the neighborhood of 30%, while the provincial border imposes a cost equivalent to a 10% tariff, on average. To gauge the significance of these costs, model estimates are used to evaluate the general equilibrium effects of changing Canada-US border costs through two counter factual scenarios. First, the cost of trading between Canada and the United States is assumed to be equivalent to trading across provincial borders. This amounts to reducing the Canada-US border cost to a 10% tariff equivalent. The second scenario is representative of Canada and the US withdrawling from a preferential trading agreement (i.e. NAFTA). For this case, it is assumed that the Canada-US border cost would increase to a 36% tariff equivalent.

Results suggest that reducing the cost of the Canada-US border from 30 to 10 per cent will lead to an 82.2 per cent increase in exports from Canada to the United States, a 52.0 per cent decrease in inter-provincial exports, and a 46.1 per cent decline in intra-provincial exports. In addition, expenditure on domestic and imported non-energy goods increases 11.4% in Canada.

Estimates also suggest that increasing the Canada-US border cost from 30 to 36 per cent would reduce Canadian exports to the United States by 23.4 per cent and increase trade within Canada with inter-provincial exports rising 11.3 per cent and intra-provincial trade increasing 9.8 per cent. The authors also find that the higher border cost would reduced non-energy goods expenditures by 1.8 per cent (approximately $10 billion CAD in 2012).


Anderson, J. E. and E. van Wincoop (2003). Gravity with Gravitas: A Solution to the Border Puzzle. American Economic Review 93(1), 170–192.

Bemrose, R. K., W. M. Brown, and J. Tweedle (2017). Going the Distance: Estimating the Effect of Provincial Borders on Trade when Geography Matters. Analytical Studies Branch Research Paper Series, no. 394. Statistics Canada Catalogue no. 11F0019M. Ottawa: Statistics Canada.

Fally, T. (2015). Structural gravity and fixed effects. Journal of International Economics 97(1), 76–85.

Silva, J. M. C. S. and S. Tenreyro (2006). The Log of Gravity. The Review of Economics and Statistics 88(4), 641–658.


CCA News // Report on infrastructure calls for greater and urgent investment in core works


CCA issued the following press release to highlight today’s release of the 2019 edition of the Canadian Infrastructure Report Card, which calls for urgent investment in Canada’s public infrastructure.


Report on infrastructure calls for greater and urgent investment in core works, says CCA.


OTTAWA, October 8, 2019 – Canada’s public infrastructure requires urgent attention in the coming decades in order to reverse the current state of disrepair, according to the 2019 edition of the Canadian Infrastructure Report Card (CIRC).

“Data from the report revealed that Canada’s public infrastructure is at serious risk,” said Mary Van Buren, president of the Canadian Construction Association. “It will require rehabilitation and replacement in the next few decades to ensure services provided continue to meet the needs of communities.”

The report, released by founding partners (CCA, Canadian Public Works Association, Canadian Society for Civil Engineering and the Federation for Canadian Municipalities), provides a timely update on the state of Canada’s public infrastructure across all core public infrastructure asset categories: roads and bridges; culture, recreation and sports facilities; potable water; wastewater; stormwater; public transit; and solid waste.

The Canadian Urban Transit Association, Canadian Network of Asset Managers and Association of Consulting Engineering Companies (ACEC) also participated in the 2019 edition.

Key takeaways from the report
Evidence informing the 2019 report shows that a concerning amount of municipal infrastructure is in poor or very poor condition. Infrastructure in this condition represents an immediate need for action, as the rehabilitation or replacement of these assets is required in the next five to 10 years to ensure that the services it provides continue to meet the community’s expectations.

An even larger proportion of municipal infrastructure is in fair condition. Infrastructure in this condition represents a view of things to come in the medium- to long-term. This infrastructure will continue to deteriorate over the next decade, falling into poor and very poor condition if rehabilitation or replacement actions are not taken.

CIRC partners are unanimous in calling upon all parties competing in the 2019 federal election to commit to addressing these shortfalls in their respective infrastructure platforms.

“CCA has made infrastructure a cornerstone of its #Construction4CDNs advocacy campaign,” said Van Buren. “Today’s release of the CIRC only strengthens our resolve in calling for a long-term 25-year blueprint for infrastructure spending in this country to ensure assets are routinely monitored and restored, preventing them from falling into such serious states of disrepair.”

The 2019 Canadian Infrastructure Report Card can be found online at


Further questions or concerns?

If you have any questions or comments about the rollout of CIRC 2019, please contact CCA’s vice-president of public affairs, Rodrigue Gilbert, at or 613-236-9455, ext. 432.

Industry News // The Guildfords Group Names William Brown President

The Guildfords Group Names William Brown President


Halifax, NS, Release: October 3, 2019 —

Darren S. Nantes, Chairman of the The Guildfords Group (Guildfords), is pleased to announce the appointment of William Brown as President.

William joined Guildfords in April of 2017 and has led significant change and improvement in numerous business processes throughout the organization. William has held Senior Executive positions for the past 9 years.  Prior to joining Guildfords, William was formerly CFO and then President of a successful steel fabrication and environmental services business catering to the oil and gas sector with operations in Atlantic Canada and Alberta.

William has significant past experience in the areas of business development, operations management and project management having managed multi-million dollar projects.

“We are fortunate to have someone of William’s caliber and experience to lead Guildfords” said Nantes. “We need strong leadership to successfully implement our strategy and take advantage of the market opportunities ahead. ”

Brown said, “This is an exciting time for Guildfords, and I’m thrilled to be taking on the President role. A strong safety culture, employees who are empowered to act and a renewed focus on our customers will be key as we execute on our growth strategy”.


About Guildfords:
Guildfords is a multi-discipline construction company which began operating in 1906 and today has operations across Atlantic Canada employing 300+ people.  Guildfords offers a wide range of services including but not limited to insulation, asbestos abatement, demolition, remediation, spray foam, coatings, fire proofing and steel cladding.


Contact Guildfords: 
25 Guildford Avenue, Dartmouth NS B3B 0H5
Phone: 902-481-7900

CANS and Marco Kick-Off Designated Gold Seal Project: The Berkeley

Marco | The Berkeley Retirement Residences

Gold Seal Kick-Off

Early afternoon, on Monday, October 7, 2019, Construction Association of Nova Scotia (CANS) staff along with representatives of Canadian Construction Association’s (CCA) Gold Seal, Marco Group and The Berkeley came together to showcase excellence in construction management. Specifically, the luncheon event was a kick-off to Marco’s construction project, The Berkeley Retirement Residences and its designation as a Gold Seal Certified Project.

Seen below, Catherine Campbell, The Berkeley, Allan MacIntosh, Marco Group of Companies, and Duncan Williams, CANS, signed a Memorandum of Understanding acknowledging their shared commitment to professionalism and considerate construction management throughout the duration of this construction project.

Representing the CCA’s program was Gold Seal Chair, Scott Mugridge, P.Eng., GSC, LEED AP, who spoke to the importance of professional designations and recognizing professional development and excellence within our workforce and on our job sites.

Designated Gold Seal: The Berkeley

The Berkeley Retirement Residence project, by Marco Group of Companies is one of two active Gold Seal Certified projects designated in Nova Scotia. Work began on The Berkeley in June 2019 and completion is expected in January 2021.

Marco’s first project for The Berkeley, this new retirement residence will be erected on the site currently occupied by the former Ben’s Bakery building near Quinpool Road in Halifax, NS. Demolition of the existing building will be undertaken by property owner, Westwood Developments. The six-storey building will contain 76 rooms, with a mix of studio, one-bedroom, and two-bedroom apartments. It will also include 20 memory-care rooms to accommodate residents with dementia.

Click here to find out more about Marco’s Designated Gold Seal Project.


Some more photos from the event (click for full-size):


Want to know more about CANS Gold Seal Projects? Contact:

Chantal Arsenault
Manager, Education & Training Development
Construction Association of Nova Scotia
T: 902-468-2267 ext. 706




CANS Advantage Program: 2019-2020 Request for Proposals Now Open!

The Construction Association of Nova Scotia (CANS) is currently seeking proposals from companies who wish to participate in the CANS Advantage Program, leveraging the buying power of the Association by offering exclusive and unique offers to CANS member companies and their employees.


The request for proposal period is now OPEN and will end on:
October 22, 2019, at 10:00 a.m.





CANS is the leading voice of the construction industry respected by members, government, industry, and the public. CANS represents more than 800 large and small companies throughout Atlantic Canada that build, renovate and restore non-residential buildings, roads, bridges and other engineering projects.

Construction is a an estimated $4 billion per year industry in Nova Scotia and employs nearly 30,000 men and women from across the province.



CANS Advantage is a loyalty program for members of the Construction Association of Nova Scotia (CANS) and their employees.

For information on the current program visit



CANS Advantage was created in March 2013 and was developed to provide members with unique and exclusive discounts on products and services throughout North America.

Advantage offers are expected to be jointly promoted by CANS and the offering companies. Promotional opportunities through CANS include, but are not limited to, promotion of offer on the CANS website (; through CANS Weekly newsletter, and social media (LinkedIn & Twitter).

Year after year, CANS will continue to build on the success of CANS Advantage and expand the program to include even more unique and exclusive offers to our members.


Questions? Please forward any applications or questions to Vanessa Greencorn

CANS Education Courses for Project Coordinators and Administrators

Did you know CANS Education & Training Development offers courses designed for Project Coordinators and Administrators?

Time is a precious commodity for any project coordinator. While we can’t add more hours to the day, CANS can try and help you use them more efficiently! Build your project management and administrative skills with CANS Education and Training Development courses. Take a peek below at some of our upcoming courses, perfect for the administrator looking to upgrade their skills!

Click the course link for more details. (Please note:  all programs are eligible for the CANS/WIPSI 50% discount!)

    • Learn tips and tricks necessary to work with data in worksheets more efficiently and effectively with Excel with Excel: Fundamentals on November 14, 2019.
    • The ability to read construction drawings is a primary function of the construction process, gear yourself with the basic principles of Blueprint Reading – Documents on November 26, 27 & 28, 2019.
    • Project Management Fundamentals is intended to provide a standard knowledge base for anyone who is involved in construction-related projects. Register now for this two day course on January 13 & 14, 2020.
    • Join CANS on January 21, 2020 for Using MS Outlook for Time Management. This one day course will help you use Microsoft Outlook to not only organize and schedule your workday but also learn tips and tricks to help manage your time more effectively.
    • The Basics: Working in a Commercial Industrial Environment is intended to provide a comprehensive introduction for project staff who are looking to have a broader understanding of the construction industry. Register your new personnel for this one day informative course on January 22, 2020.
    • Communication and listening skills are at the core of preventing interpersonal conflict and dealing with difficult personalities. Education your front end staff with the skill set they need to interact with clients confidently and professionally with Communicating with Confidence on February 5, 2020.
    • Effective Phone Communication Skills on March 12, 2020 focuses on customer service excellence, sales skills and mastering precise, brief communication to get answers and results from those you are communicating with.

The Spirit of “Mr. Construction” Lives on with Memorial Scholarship

David Oulton’s memory continues to support construction industry through recently awarded NSCC scholarship.

(HALIFAX, NS — September 6, 2019) The David Oulton Memorial Scholarship was awarded for the first time to Sanchari De, at Construction Association of Nova Scotia’s office on Friday, September 6, 2019.

CANS Board Members and staff, Oulton’s surviving family, long-time colleagues and representatives from NSCC gathered Friday morning to present Ms. De with the new scholarship.

For more than half a century, the award’s namesake, David Oulton was a driving force in the construction industry, locally and abroad. Much of his life was spent working with people, trying to find a way to build their projects but also change the way construction was viewed. While his passion for construction earned him the nickname, “Mr. Construction” among friends, Oulton cared about much more than just buildings.

He spent a great deal of time volunteering in his community. “Dave’s involvement in construction wasn’t limited to fabricating and erecting the steel. He recognized that in order to grow and improve the construction industry, he needed to share his knowledge,” said CANS Vice-Chair, Tim Houtsma Friday morning.

Oulton was a man of his word, playing an active role in this community over the years. He was Chairman of CANS (1999), as well as sitting on various boards including, the Sector Council, the CCA and the NSCLR. He was a pioneer in driving positive relations with the Ironworkers Local 752, was a trustee on their Pension and Benefits plan, as well as instrumental in developing their apprenticeship program.

In 2007, Oulton spearheaded the CANS 150th Anniversary Industry Campaign. This campaign raised over $1.2 million in scholarships and bursaries for students in construction-related programs at the NSCC. “Hundreds of students have benefited from this program and will continue to benefit for decades to come:” said Duncan Williams, President and CEO of the CANS.

Despite his personal efforts to develop the industry, Oulton was a humble man. His wife, Connie said, “I don’t know that Dave would want recognition — he was the type to be an anonymous donor. He lived to work, the industry was so important to him.”

“Dave would’ve shied away from the spotlight of awarding this scholarship,” shared Houtsma, “but I know that he would be quietly proud that he is helping someone gain knowledge and benefit the construction industry.”

The award’s recipient, Sanchari De, will begin studies this September at the Ivany Campus. Despite the whirlwind of change — she arrived in Canada just 10 days before the award ceremony, De is excited to begin her studies in Nova Scotia. “It was a hard decision to leave my job and come this far from [India], but I believe that it will open various opportunities for me. I am willing to give my 100% to this course and hope to make my family proud one day.”

The newly created, David Oulton Memorial Award scholarship is given to a full-time student, enrolled in the Construction Management Technology program at NSCC, who demonstrates strong leadership abilities and a background of community involvement.


2019 CANS Herc Rentals Softball Tournament Wrap-Up


It was a sunny Saturday for a fun-filled Softball Tournament in Dartmouth!  17 teams enjoyed a day of networking, great pitches, quite a few runs and plenty of fun at the 2019 CANS Herc Rentals Softball Tournament on August 24th at the Mount Edward Road Ball Fields.


A BIG thanks to all our sponsors: Herc Rentals, MacFarlands Industrial, Dexel, Turf Masters Ltd., Black & McDonald Limited, Iron Dog, MNP LLP, Q104, BELFOR, Big Bang Promotional Products, BIRD Construction, Casey Concrete Ltd., Heritage Gas, MCT Insurance a division of BrokerLink, REgroup, Sancton, and Rogers Communications Canada.

Techno Hard Surfaces Limited

Atlantica Mechanical Contractors Limited

The Fun Division Trophy went to Techno Hard Surfaces Limited, with second place going to Bird Stairs (J.W. Bird & Company Limited).  The Competitive Division Trophy went to Atlantica Mechanical Contractors Ltd., with second place going to McCarthy’s Roofing Ltd.  Congratulations to all the winners!


Kids of all ages had fun at The Game Zone this year!  In between games, players, families and spectators bounced in the inflatable fun house, played washer toss, bean bag toss, and many other games from Glow Parties!


Thank you to everyone who participated in the 2019 Softball Tournament! If you attended the tournament, we would love to hear your feedback.  Please visit the online survey:


Catch up on the fun, check out more photos of CANS softball, along with all of our events, here

CANSTech 2020 – Call for Speakers/Exhibitors

CANSTech 2020

Presented by:

Procore Logo

CANS is currently seeking sponsors and accepting applications for exhibitors and speakers for CANSTech 2020,  February 27, 2020 at the Cunard Centre.


CANS is proud to present CANSTech – Nova Scotia’s Construction Technology and Innovation Tradeshow for the commercial, industrial and institutional construction industry.

We are thrilled to bring back this innovative and experiential conference for a second time as CANSTech 2020. This event is the only conference in Nova Scotia that highlights cutting-edge solutions specifically for the construction industry, as well as provides attendees with opportunities for hands-on experience with leading-edge technologies.

Get the most out of CANSTech 2020, sign up now to be a sponsor, or apply to be an exhibitor or speaker at the event. Your company will be featured throughout promotional materials in the months leading up to the event. Not to mention, you will get the chance to engage with over 1,000 anticipated attendees day-of!


Is your company breaking new ground in the construction industry? Seeing is believing, so we’re seeking exhibitors who will actively engage attendees with quality experiences and hands-on demonstrations. Let us know how you would stand out from the crowd, APPLY NOW to be an exhibitor at CANSTech2020.


Do you have hands-on experience or real-world knowledge about modernizing workflows? We’re looking for speakers who can offer attendees a practical perspective on how to adapt their business in a new, technological landscape. APPLY NOW to be a speaker at CANSTech 2020.


Does your company embrace technological advancements and/or new innovations readily? CANSTech prides itself highlighting new innovations and technologies, so we’re seeking sponsors who will support our mission to keep the construction industry nimble and adaptable to technological growth.

Find out more on sponsoring CANSTech 2020: take a look at our full list of sponsorship opportunities, or REGISTER NOW — no application needed — as a sponsor, contact Natalie Bobbitt, Sponsorship Lead.


For more information on how to participate in CANSTech 2020, contact:

Natalie Bobbitt
Sponsorship Lead
902-468-2267 ext. 718


For more information on CANSTech, or to see photos of the inaugral event visit:

NSBI Accepting Applications for Innovation Rebate Program

Nova Scotia Business Inc. (NSBI) is currently accepting applications for its Innovation Rebate Program.

The Innovation Rebate Program supports Nova Scotia businesses looking to increase their global competitiveness. The program provides financial incentives on projects that enable a company to increase innovation capacity through private-sector capital investments or adoption of new technologies and business processes.

To find out more and/or apply for this program, visit:

Please review the Guidelines and FAQ before submitting your application.