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211. Parental Support, Savings and Student Loan Repayment

Author:
Lance Lochner, Todd Stinebrickner, and Utku Suleymanoglu
Publication Date:
07-2018
Content Type:
Working Paper
Institution:
Centre for Human Capital and Productivity (CHCP), Western University
Abstract:
Using unique survey and administrative data from the Canada Student Loans Program, we document that parental support and personal savings substantially lower student loan repayment problems. We develop a theoretical model for studying student borrowing and repayment in the presence of risky labor market outcomes, moral hazard, and costly earnings verification. This framework demonstrates that non-monetary costs of applying for income-based repayment assistance are critical to understanding why resources other than earnings lead to greater repayment. We further show that eliminating these non-monetary costs may be inefficient and lead to undesirable redistribution. Empirically, we demonstrate that expanding Canada’s income-based Repayment Assistance Plan to automatically cover all borrowers would likely reduce program revenue by nearly one-half over early years of repayment. Finally, we show how student loan programs can be more efficiently designed to address heterogeneity in parental transfers in the presence of non-monetary earnings verification costs and moral hazard.
Topic:
Debt, Economics, Human Capital, Higher Education, Productivity, and Student Loans
Political Geography:
United States and Canada

212. Job Tasks and the Gender Wage Gap among College Graduates

Author:
Todd Stinebrickner, Ralph Stinebrickner, and Paul Sullivan
Publication Date:
06-2018
Content Type:
Working Paper
Institution:
Centre for Human Capital and Productivity (CHCP), Western University
Abstract:
Gender differences in current and past job tasks may be crucial for understanding the gender wage gap. We use novel task data to address well-known measurement concerns, including that standard task measures assume away within-occupation gender differences in tasks. We find that unique measures of task-specific experience, in particular high-skilled information experience, are of particular importance for understanding the substantial widening of the wage gap early in the career. Highlighting the importance of these measures, traditional work-related proxies for gender differences in human capital accumulation are not informative because general work experience is similar by gender for our recent graduates.
Topic:
Economics, Gender Issues, Labor Issues, Human Capital, Higher Education, and Productivity
Political Geography:
United States and Canada

213. Uncertainty about Future Income: Initial Beliefs and Resolution During College

Author:
Yifan Gong, Todd Stinebrickner, and Ralph Stinebrickner
Publication Date:
03-2018
Content Type:
Working Paper
Institution:
Centre for Human Capital and Productivity (CHCP), Western University
Abstract:
Uncertainty about future income plays a conceptually important role in college decisions. Unfortunately, characterizing how much earnings uncertainty is present for students at college entrance and how quickly this uncertainty is resolved has proven to be difficult. This paper takes advantage of unique expectations data from the Berea Panel Study to provide new evidence about this issue. We characterize initial uncertainty using survey questions that elicit the entire distribution describing one’s beliefs about future earnings at an ideal time - immediately before students began their first year courses. We characterize the amount of uncertainty that is resolved during college by taking advantage of the longitudinal nature of the expectations data. Taking advantage of a variety of additional survey questions, we provide evidence about how the resolution of income uncertainty is influenced by factors such as college GPA and college major, and also examine why much income uncertainty remains unresolved at the end of college.
Topic:
Economics, Income Inequality, Human Capital, Higher Education, and Productivity
Political Geography:
United States and Canada

214. A tale of Two Speeches

Publication Date:
01-2018
Content Type:
Working Paper
Institution:
Jerusalem Institute for Strategy and Security (JISS)
Abstract:
Harper and Pence have offered moral and spiritual leadership for the world. Their momentous Knesset speeches were epoch-making events.
Topic:
Diplomacy, International Cooperation, and Leadership
Political Geography:
Middle East, Canada, Israel, North America, and United States of America

215. War’s Future: The Risks and Rewards of Grey-Zone Conflict and Hybrid Warfare

Author:
David Carment
Publication Date:
10-2018
Content Type:
Working Paper
Institution:
Canadian Global Affairs Institute (CGAI)
Abstract:
Today’s geopolitical conflicts, especially among great powers, involve a desire to fundamentally revise the order of alliances as well as solidify new norms of conduct. The purpose of our paper is to delineate two distinct phenomena in international affairs – hybrid warfare, which emphasizes the tactical level and grey-zone conflicts, which incorporates a long-term strategic dimension into international disputes. We argue that hybrid warfare can be a tactical subset of grey-zone conflict deployed under certain conditions and in varying degrees. We examine four case studies: China’s application of ‘unrestricted warfare’, Russia’s strategy of ‘hybrid balancing’, ‘regional hybridism’ practiced by Israel and ‘restricted hybridism’ applied by Canada/NATO globally. We conclude that the solution to challenges from Russia and China is not a military one but a political and collective one based on baseline requirements for building resilience. Israel, on the other hand, is largely uninterested in the revision of order of alliances and will continue to utilize its tactical advantage vis-à-vis regional neighbors to achieve victories in short conflicts. We conclude that NATO (and Canada) should work more closely with the Organization for Security and Co-operation in Europe and the European Union to effectively extend security guarantees to its members. In doing so Canada and likeminded countries will involve the costs of engaging in hybrid warfare and the subsequent erosion of democratic accountability.
Topic:
NATO, War, Geopolitics, and Hybrid Warfare
Political Geography:
Russia, China, Eurasia, Middle East, Canada, Israel, and Asia

216. The Security Dimension of a China Free Trade Agreement: Balancing Benefits and Risk

Author:
Gordon Houlden
Publication Date:
08-2018
Content Type:
Working Paper
Institution:
Canadian Global Affairs Institute (CGAI)
Abstract:
In 2017, Canada engaged in several rounds of exploratory discussions for a potential free trade agreement (FTA) with the People’s Republic of China. It seemed probable that this exploratory phase would be followed by the opening of formal rounds of negotiations, to be announced during Prime Minister Justin Trudeau’s visit to China in December 2017. An FTA appeared to be a priority for Trudeau since his government came into office in 2015 (Global Affairs Canada, 2017a; Lu, 2017; PMO, 2017); however, such negotiations were put on hold indefinitely, ostensibly due to irreconcilable differences on gender and labour issues. Despite this setback, it is likely that the Canadian government will continue to explore this option in the coming years, particularly with the North American Free Trade Agreement (NAFTA) in jeopardy. While there are many potential benefits of a Canada-China free trade agreement (CCFTA), there are also significant national security implications that will deserve particular attention. The security dimension will be the focus of this paper. Prospective CCFTA negotiations with China would be both complex and time consuming, in part due to the wide divergences between the Canadian and Chinese economies, as well as differences between Canadian and Chinese administrative and legal systems. Negotiations could therefore take several years to conclude, and might not be finished until well after the 2019 federal election. It took a full decade to sign and ratify the China-Australia Free Trade Agreement (ChAFTA), although it appears that the most difficult portion of the negotiations was wrapped up in the final two years. It is unlikely that a CCFTA will move as slowly as the Australian FTA did, in part because of the established Australian precedent and because of China’s increasing familiarity with FTA negotiations that involve advanced economies. For this reason, Canada would benefit from approaching a CCFTA after Australia, but before many other Western countries. Chinese and Canadian negotiators will be consumed with elaborating the principles of each side’s responsive FTA approaches, as well as the myriad of details involving thousands of products and services that a CCFTA’s provisions would affect. Canadian negotiators will seek a high-quality FTA that covers a large percentage of our export and import products with China, as well as an agreement that covers all key sectors and industries. There is also likely to be a Canadian focus on addressing China’s use of non-tariff barriers to trade which currently inhibit Canadian firms from taking full advantage of the massive China market. Such measures include the Chinese Ministry of Health’s 2013 changes to food safety standards which required all imported food products to list detailed nutritional components in Chinese. Procedural barriers such as this represent a significant hurdle for Canadian firms, and cause uncertainty among international exporters that want to break into the Chinese domestic market. In theory, the centralized Chinese economy lacks the regional complexity of the Canadian federal state, characterized by sub-national units, but in reality, China’s provinces and municipalities can, and often do, impose barriers to foreign imports, often to protect market share for local substantive industries. To date, China has FTAs with only a handful of developed countries. Australia, Korea, Switzerland, Iceland, Singapore and New Zealand currently have bilateral FTAs with China, and several others, such as Norway and Israel, are in FTA negotiations. China is also floating ideas for FTAs with developing countries, including India. China is far more trade-dependent than the United States, although by comparison China is not nearly as trade-dependent as Canada is.1 The balance of trade is currently in China’s favour: China exports US$46 billion to Canada, versus the US$16 billion that it imports from Canada (MIT, 2016a). However, it is important to note that China’s exports to Canada account for only 2.2 per cent of China’s total merchandise exports (MIT, 2016b).
Topic:
Security, Intellectual Property/Copyright, Free Trade, and Trade
Political Geography:
China, Canada, Asia, and United States of America

217. Surviving and Thriving in the Digital Economy

Author:
Goran Samuel Pesic
Publication Date:
03-2018
Content Type:
Working Paper
Institution:
Canadian Global Affairs Institute (CGAI)
Abstract:
Cyber-crime is growing exponentially and Canadian governments at all levels have not kept pace quickly enough to protect both themselves and private enterprise. Evolving technology allows for ever-more sophisticated cyber-threats to intellectual property, but some businesses and governments have neither changed their pre-internet thinking nor established adequate safeguards. Protection should start with educational campaigns about the scope and varieties of risk that permeate the private sector, e-commerce and smart cities using the internet of things. Thirty years ago, just 32 per cent of the market value of Standard & Poor’s 500 companies was based on intangible assets, mainly intellectual property. Today, that figure stands at 80 per cent and protecting those assets from cyber-crime is of vital importance. While cyber-criminals look to make money off of phishing scams, their interests have also extended to infiltrating proprietary industrial designs, resource management and information affecting acquisitions. The fact that some countries see this type of crime as a normal way to gain access to foreign business information is often poorly understood by Canadian businesses accustomed to functioning under much higher ethical standards. The e-commerce realm faces its own cyber-threats including those affecting privacy, data sovereignty, location of data centres, data security and legislation. E-commerce merchants must protect themselves by ensuring the security of their clients’ computers, communication channels, web servers and data encryption. It sounds daunting, but it shouldn’t be. Merchants can take steps such as doing risk assessments, developing security policies, establishing a single point of security oversight, instituting authentication processes using biometrics, auditing security and maintaining an emergency reporting system. Government can assist with cyber-security in Canada’s private sector through awareness campaigns, rewarding businesses for best practices, providing tax credits to offset the cost of security measures, and offering preferential lending and insurance deals from government institutions. The federal government’s 2015 Digital Privacy Act was a good first step, but there is much territory left to be covered. The act offers little assistance in making the leap from a pre-internet governmental model of doing business with the private sector. Nor does it acknowledge the full costs organizations must face when contemplating improving their cyber-security. The growth of smart cities, connected to the internet of things, creates new susceptibilities to cyber-crime. By 2021, there will be approximately 28 billion internet-connected devices globally and 16 billion of those will be related to the internet of things. However, smart cities appear to be low on the list of cyber-security priorities at all levels of government. There is a lack of local guidance and commitment, an absence of funding programs and tax incentives for risk-sharing arrangements, and nothing in the way of a federally initiated smart-cities strategy. The key to keeping ahead of the cyber-criminals is to recalibrate our understanding of the threats accompanying the technology. New ideas, new economic policies, new safeguards, new regulations and new ways of doing business will all help to keep Canada safe in the burgeoning knowledge economy.
Topic:
Crime, Digital Economy, Economy, Internet of Things, and Cyberspace
Political Geography:
Canada and Global Focus

218. Op PRESENCE – Mali: Continuity Over Change in Canada’s “Return to Peacekeeping” in Africa

Author:
Chris W. J. Roberts
Publication Date:
10-2018
Content Type:
Working Paper
Institution:
Canadian Global Affairs Institute (CGAI)
Abstract:
Nearly 20 years since its last significant contribution to United Nations (UN) peacekeeping in Africa, Canada deployed an aviation task force to Mali in July 2018 to support MINUSMA for one year. This carefully selected tasking represents continuity in the types of capabilities Canada deploys to UN operations in Africa, stretching back to Suez and the Congo (i.e., mostly enablers, not combat arms). Concurrent debates about whether MINUSMA represents peacekeeping or war-fighting are unhelpful: peacekeeping has not been wholly synonymous with Suez and Cyprus-type missions since Congo in 1960-1964, and particularly not since the end of the Cold War. Many Canadians (politicians and public alike) are distracted by a number of myths around peacekeeping and Africa’s supposed marginality to Canadian security and prosperity. These myths draw attention away from important debates which still need to be held about Canada’s role in multilateral peace support operations and how best to ameliorate African regional security challenges that have direct and indirect consequences for Canada and world order.
Topic:
Security, Foreign Policy, United Nations, and Peacekeeping
Political Geography:
Africa, Canada, and Mali

219. Justice for the Victims: How Canada Should Manage Returning “Foreign Fighters”

Author:
Kyle Matthews
Publication Date:
09-2018
Content Type:
Working Paper
Institution:
Canadian Global Affairs Institute (CGAI)
Abstract:
The U.S.-led international coalition has dislodged the Islamic State in Iraq and Syria (ISIS) from the cities it had occupied and controlled, namely Mosul and Raqqa. But while the group is weakened, it lives on and remains dangerous. Both the U.S. Department of Defense and the UN estimate that approximately 30,000 ISIS fighters remain in those countries. At the same time, a significant number of “foreign fighters” have fled Iraq and Syria. Numerous countries are struggling to find policy solutions with regards to managing the return of their nationals who had joined the group. The Canadian government has stated publicly that it favors taking a comprehensive approach of reintegrating returnees back into society. Very few foreign fighters who have returned to Canada have been prosecuted. Canada has both a moral and legal duty to seek justice and uphold the most basic human rights of vulnerable populations. ISIS and other jihadist groups engaged in systematic mass atrocities against minorities in Iraq and Syria, including Christians and Shiites. ISIS has demonstrated a particular disdain for the Yazidi minority in Iraq, and the Canadian government has recognized the group’s crimes against the Yazidis as genocide. As a State Party to the Rome Statute of the International Criminal Court and a signatory of the Convention on the Prevention and Punishment of the Crime of Genocide, Canada has a responsibility to uphold these international legal conventions when formulating carefully crafted policy responses that deal with returning foreign fighters. Canada should attempt to prosecute its nationals in domestic courts using the Crimes Against Humanity and War Crimes Act. Open trials can serve as means by which to lay bare ISIS’ narrative and to help counter violent extremism and future atrocities. They can also serve as a deterrent and warning to other Canadians who might try to join ISIS as it mutates and moves to other countries in the world, such as Libya, Afghanistan, Egypt, the Philippines, Pakistan, or heaven forbid, in Mali where Canadian peacekeepers have recently been deployed. If Canada truly stands for multiculturalism, pluralism, the rule of law, global justice, human rights, and the liberal international order, then we must stand firm and take a principled stand to prosecute those who have fought under the ISIS banner. That includes our own citizens.
Topic:
Crime, Human Rights, Terrorism, Islamic State, Justice, and Foreign Fighters
Political Geography:
Iraq, Middle East, Canada, Syria, North America, and United States of America

220. From NORAD to NOR[A]D: The Future Evolution of North American Defence Co-operation

Author:
Andrea Charron and James Fergusson
Publication Date:
05-2018
Content Type:
Working Paper
Institution:
Canadian Global Affairs Institute (CGAI)
Abstract:
The North American defence environment is in the process of a major transformation, occasioned by dramatic changes in the geostrategic/political landscape and the development of new generations of weapon systems. As a result, the requirements to deter, detect and defend North America from a variety of new threats are transforming. In this context, Canada and the United States, through the Permanent Joint Board of Defense (PJBD) established the Evolution of North American Defense (EvoNAD) study, and tasked its execution to the North American Aerospace Defense (NORAD) command. EvoNAD considers a long time horizon and has been broken into subcomponents reflecting six domain priorities: air, maritime, cyber, aerospace, space and land. The overarching factor which binds the six components together is the recognition that the single-domain threat environment is evolving into a multi-domain one. In the past, the threat to North America resided largely on a single axis (north-south), within a dominant domain (air, combined with ballistic missiles), met by a bi-national structure. While this threat seemed to collapse with the end of the Cold War, NORAD continued and evolved to adapt to new threats as well as to continue to monitor the Cold War-styled air and aerospace threats. Subsequently, 9/11 created a new threat environment and forced NORAD to consider threats emanating from within North America as well as outside of it. In addition to a number of changes, including direct feeds from the Federal Aviation Administration (FAA) and NAVCANADA, NORAD expanded into the maritime domain via a maritime warning mission. Roughly at the same time, NORAD’s attention also turned to the cyber-domain and its common threat to North America. The air threat has now returned with the resumption of long-range Russian flights across the Arctic, and down the Atlantic and Pacific coasts. This threat, however, is of a different character because of the development of a new generation of Russian long-range air-launched cruise missiles, as well as sea-launched cruise missiles, which have direct implications for NORAD’s capacity to deter, detect and defend, as well as for its current area of operations and mission suites (air/aerospace warning and control and maritime warning). Not only will these new long-range capabilities diffuse to other potential adversaries, generating a global threat environment, but also the first generation of hypersonic weapons has set the conditions for the merger of air and missile defence, and the air and outer space domains. Finally, the consequences of an attack against North America, alongside potential catastrophic natural disasters relative to the role of military forces in support of civil authorities, raises issues for both Canada and the U.S., and thus NORAD, regarding the most efficient and effective means to respond. The multi-domain/multi-dimensional North American threat environment should drive both Canada and the U.S. towards deeper defence co-operation, and the functional demands of this new threat environment could lead to NORAD’s ultimate transformation into an integrated, multi-domain and dimensional North American Defense Command solution. Of course, this outcome is not inevitable, and numerous barriers exist. Nonetheless, the same logic which led to NORAD’s creation in 1957 (with the agreement signed in 1958), remains valid. Driven by the common recognition that the defence of North America is indivisible, a North American Defense Command would be a natural evolution in Canada – American defence relations.
Topic:
Defense Policy, International Cooperation, Regional Cooperation, Maritime, Land, and Cyberspace
Political Geography:
Canada, North America, and United States of America