Let's talk about Alberta’s economy, everyone’s favourite subject
- J. Tayler Smith
- Oct 22, 2022
- 8 min read
Reviewing David L. Ryan's Boom and Bust Again: Policy Challenges for a Commodity-Based Economy by J. Tayler Smith
Good, but not for everyone
I grew up in a Canadian community where many people had a Dutch heritage. Both of my closest friends as a child were of Dutch descent (I, meanwhile, am of a British/German background). As a kid, my friends had one particular candy they insisted that I try. Dutch black licorice. Very quickly, I discovered my distaste for this particular candy flavour. However, I acknowledge that it is not inherently a bad treat, it just wasn’t suited to my taste. For some, this is perhaps the best candy they may ever encounter.
Boom and Bust Again is to citizens of the Canadian province of Alberta as that particular black licorice was to my Dutch friends. It is very good for some, but others won't have a reason to like it (and that’s okay). Boom and Bust Again is a policy book published in 2013 that examines Alberta’s economic and policy framework. For most, this may be the most boring and irrelevant book they could ever encounter; however, it is better than what one assumes at first glance. Yet, I must acknowledge that this book is for a specific group of people, particularly those who wish to better understand Alberta’s economy.
It's essays! (yay?)
Boom and Bust Again is a compilation of essays written by contributors who participated in the University of Alberta’s 2009 conference on the Alberta economy. The book consists of fourteen essays, two cover introductory topics, and one summarises what the remaining essays discuss. This leaves the remaining eleven essays that each address a specific economic or policy issue specific to Alberta.
The first contributor is John D. Murray, whose essay focuses on showing that oil and natural gas, the backbone of Alberta’s economy, are not likely to permanently increase in price as some mistakenly believe. This means it is not wise for Albertan policymakers to tie Alberta’s economic hopes to these products alone.
The second contributors are J. C. H. Emery and Ronald Kneebone, who suggest that booms in the oil and gas industry are unlikely to result in sustained economic growth because they also coincide with regular busts. Historically, the government has based their budget on the economic booms while failing to prepare for busts - they forget that Alberta’s ‘normal’ economy lies somewhere in the middle.
Bev Dahlby, Kathleen Macaspac, and Melville McMillan address the issue of economic stability and find that, contrary to prevailing wisdom, instability in the Alberta economy is diminishing despite the province’s continued reliance on the oil and gas sector, which is typically associated with more instability.
Edward J. Chambers, Jason Brisbois, and Nicholas Emter focus on whether it is possible for Alberta to effectively diversify its economy as a way to reinforce economic stability. They conclude that while it is possible, and maybe necessary for Alberta to diversify, it is very challenging to do so because of the prevailing wisdom already rooted in the province that speaks against diversification.
Roger Gibbins argues that it is better for Alberta to lean into the oil and natural gas sector and to focus on developing ways to extract these resources with the lowest possible carbon output so that it can sell this knowledge and processes to the rest of the world. He argues that this is possibly the best way for Alberta to ‘green’ its economy without losing the benefits it receives from oil and gas.
Robert L. Ascah notes at the time of the conference that Alberta did not have a robust savings strategy for when it experiences an economic boom. Therefore, it needs to develop such a strategy to stabilize the economy during busts.
Colin Busby adds that policy reformation needs to occur in the province and that citizens need to be better informed that such fiscal reform is meant to safeguard government services during an economic downturn.
Stuart Landon and Constance Smith also argue that the best way for Alberta to address economic volatility is to further develop and redeploy its savings fund program, which has largely been left dormant and depleted since its inception.
Brad R. Humphreys and Victor A. Matheson explore whether gambling revenues can offset economic volatility in the province since such revenues do not correlate with oil and gas booms and busts. They find that gambling revenues have some positive impact on stabilizing the economy, but not a large enough impact to make a significant difference.
Al O’Brien focuses on the benefits of the province developing a more sustainable tax structure that ensures financial stability. Essentially, he asks that the province recognize that oil and gas resources are finite and that fiscal policy reflects this reality.
Boom and Bust Again APPRAISED
This book is relatively easy to APPRAISE. However, I had a lot of trouble deciding whether it was an enjoyable read. This difficulty was due to each chapter being written by a different author. Some contributors are excellent, but some are just boring. I decided it was best to appraise the book as a whole rather than each essay separately, and came to the conclusion that it was overall enjoyable enough to warrant a little praise in this area. In reality, it would be best to appraise each essay separately, but that is far too time-consuming for something that may only ever be read by a handful of people.
Accuracy
The book is reasonably accurate and truthful seeing how each contributor backs their arguments with verifiable facts and figures. Each of them approaches the core issue of Alberta’s economy from a slightly different perspective, which allows contributors to contradict each other's conclusions without disagreeing on the facts of the matter. What makes this policy book refreshing is that it was written at a time when people tended to agree on the same baseline political facts and issues and only differed on what they focused on and why. To that end, this book feels like a collaborative effort to find a solution to Alberta’s economic challenges.
Praiseworthiness
Though the book is nearly a decade old, and can be technically challenging to read at times, I think most Albertans would benefit from reading it. At the very least, it is worth reading if one wants to better understand how the Alberta economy works and the pros and cons of depending on oil and natural gas. It’s not a book that goes out of its way to change people’s minds; instead, it focuses on the current state of affairs (a decade ago) and asks its readers to decide for themselves what they think is the best decision to make based on these facts. My hope is that more Albertans would read materials like this going forward.
Proficiency
The book was written by academics, experts, and analysts in their particular fields, meaning there is a wealth of experience and knowledge to glean here. It is evident from the backgrounds of the authors and research projects associated with each contributor that they are very proficient in their fields. For the most part, each author also writes in a way that is reasonably understandable to the average reader. This is not the case for all contributors, especially those who rely on mathematics to explain their findings, but the main point of each essay is still easy enough to understand.
Reverence
The book is reasonably successful at remaining politically and economically neutral. To that end, it is also successful at focusing on issues that are important to Albertans, and ensuring that the well-being of the province is at the forefront of each conversation. The authors hardly criticise those who oppose their arguments; in fact, they generally only focus on proving why what they are saying is true. Each author only focuses on building their case, they do not tear down the views of others. To this end, the book is reverent to people and the province at large.
Artistry
This is a policy book, featuring some graphical charts and tables. It is not trying to be entertaining or artistic, and that is okay. However, this can be a barrier to some readers and makes the book appear more challenging to read than it is in actuality.
Integrity
The book is focused on discovering the right thing for Alberta to do at the right time. Therefore, the book maintains integrity in its purpose. The authors seek to ensure that Albertans are justly compensated for the work they do, but they are not afraid to address core issues that question whether Alberta is taking the right steps to secure its future. While the authors do not put forward a clear answer, they certainly ask the right questions.
Superbness
Despite everything I have said, there is nothing in the book that puts it over the edge. It’s good, but it’s not great, and that has much to do with the subject material itself. Economics and policy tend to be dry, which is the case with this book. That being said, it is better than most would assume, it just isn’t superb.
Enjoyability
I went back and forth on deciding whether the book is enjoyable and decided that I just barely consider it an enjoyable read.. The first several essays are better than the latter few, as they are written at a more easily understood level and they address policy issues that can be talked about through stories and anecdotes. The latter half of the book focuses more heavily on economic issues that are discussed in mathematical terms, making it harder to enjoy.
Decency
This is not the sort of book in which one expects to find any indecent material, and one does not find any. Therefore, the book is decent.
Economics for Albertans
Overall, I think Boom and Bust Again is far better than people may expect. However, it is specifically written with respect to a particular geographic location on earth in a particular year (Alberta, 2009). Therefore, the book is best suited to citizens of the province of Alberta and it is not worth reading for almost anyone else. However, economic students may find it a good case study for future classes and research. Nevertheless, since I am a citizen of Alberta and still found the book relevant today, I give it seven out of nine stars.
References
Ascah, Robert L. 2013. “Savings of Non-renewable Resource Revenue.” In Boom and Bust Again: Policy Challenges for a Commodity-Based Economy, edited by David L. Ryan, 151-198. Edmonton, Alberta: The University of Alberta Press.
Busby, Colin. 2013. “Searching for Ropes and a Mast.” In Boom and Bust Again: Policy Challenges for a Commodity-Based Economy, edited by David L. Ryan, 199-224. Edmonton, Alberta: The University of Alberta Press.
Chambers, Edward J., Jason Brisbois, and Nicholas Emter. 2013. “I've Heard that Song Before.” In Boom and Bust Again: Policy Challenges for a Commodity-Based Economy, edited by David L. Ryan, 105-132. Edmonton, Alberta: The University of Alberta Press.
Dahlby, Bev, Kathleen Macaspac, and Melville McMillan. 2013. “Output Instability in Resource-Based and Diversified Economies.” In Boom and Bust Again: Policy Challenges for a Commodity-Based Economy, edited by David L. Ryan. Edmonton, Alberta: The University of Alberta Press.
Duckett, Stephen, Gordon Kramer, and Liesje Sarnecki. 2013. “Alberta's Health Spending Challenge.” In Boom and Bust Again: Policy Challenges for a Commodity-Based Economy, edited by David L. Ryan, 301-334. Edmonton, Alberta: The University of Alberta Press.
Emery, J. C. H., and Ronald Kneebone. 2013. “Three Strikes and Your Out?” In Boom and Bust Again: Policy Challenges for a Commodity-Based Economy, edited by David L. Ryan, 39-58. Edmonton, Alberta: The University of Alberta Press.
Gibbins, Roger. 2013. “When Worlds Collide.” In Boom and Bust Again: Policy Challenges for a Commodity-Based Economy, edited by David L. Ryan, 133-150. Edmonton, Alberta: The University of Alberta Press.
Humphreys, Brad R., and Victor A. Matheson. 2013. “Boom, Busts, and Gambling.” In Boom and Bust Again: Policy Challenges for a Commodity-Based Economy, 267-284. Edmonton, Alberta: The University of Alberta Press.
Landon, Stuart, and Constance Smith. 2013. “Government Revenue Volatility in Alberta.” In Boom and Bust Again: Policy Challenges for a Commodity-Based Economy, 225-266. Edmonton, Alberta: The University of Alberta Press.
Murray, John D. 2013. “Is There a Commodity Curse?” In Boom and Bust Again: Policy Challenges for a Commodity-Based Economy, edited by David L. Ryan, 23-38. Edmonton, Alberta: The University of Alberta Press.
O'Brien, Al. 2013. “Expenditure Management in Alberta.” In Boom and Bust Again: Policy Challenges for a Commodity-Based Economy, edited by David L. Ryan, 285-300. Edmonton, Alberta: The University of Alberta Press.
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