Theorizing Canada as a Challenge to the American Developmental State: From John Rae to Jacob Viner

Elsbeth Heaman, McGill

Recent work on American economic history, looking to account for how it turned from specialized raw-goods exporter to industrialized and diversified power, looks for mechanisms of state intervention and integration. I propose an overlooked constituent of that emerging conceptualization: the border with Canada. Following work by Jeffers Lennox and Bradley Miller, I show that Canada was an important sparring partner that helped bring the American economy into clearer focus, albeit obscured by hindsight. Early economic models were often more lumping than splitting (Lower Canada's economy grew on shipping US goods to Britain as "colonial"; Upper Canada's grew on the developing US market), but in the 1820s, John Rae began to make the case for “infant industry” development more splitting than lumping. As the border hardened politically, so did economic policies, along with American determination to force Canada into America by purely economic pressure. North-South economic pressures were channeled into East-West ones, a process requiring continual redefinition and delineation. Canadian economists theorized the border more than American economists and began to speak of a Canadian “economy” early in the twentieth century, before the term entered general usage. At mid-century, where Harold Innis made Canada the exemplar for national-economic resistance to an American-dominated free market, Jacob Viner made it the exemplar for non-resistance. But Viner also drew on Canada to criticize the new development theories that wrongly took America’s own development, as a universal template, misunderstanding the role of agriculture and the capacity for autarky.

No extended abstract or paper available

 Presented in Session 197. Rethinking the Developmental State 4: North America