Is There Convergence in Provincial Spending Priorities?

Abstract

This article examines the question of whether the provinces are becoming increasingly similar in their total spending and in the level of spending devoted to particular functional areas. Using various measures of spending, we begin by briefly tracing the pattern of provincial spending between 1971 and 1994. We then show, using Dispersion Indexes, that in some areas there has been a persistent movement toward similar levels of spending and similar spending priorities, while in other areas a divergent or indeterminate pattern has been established. Of some importance is the fact that particular provinces are outliers or influential cases and as such have the capacity to influence significantly the degree of convergence observed. In addition, the 24-year period is not one unbroken pattern. In some cases the provinces reverse their initial convergent direction and become increasingly different from one another. We suggest some reasons for these patterns, including the role of federal-provincial fiscal relations and the impact of changing economic conditions.