Staples thesis

In economic development, the staples thesis is a theory of export-led growth based on Canadian experience. The theory "has its origins in research into Canadian social, political, and economic history carried out in Canadian universities...by members of what were then known as departments of political economy". From these groups of researchers, "the two most prominent scholars following this approach were Harold Innis and W.A. Mackintosh".

The thesis explains Canadian economic development as a lateral, east-west conception of trade. Innis argued that Canada developed as it did because of the nature of its staple commodities: raw materials, such as fish, fur, lumber, agricultural products and minerals, that were exported to Britain and the West Indies. This trading link cemented Canada's cultural links to Britain. The search for and exploitation of these staples led to the creation of institutions that defined the political culture of the nation and its regions.

Innis argues that different staples led to the emergence of regional economies (and societies) within Canada. For instance, the staple commodity in Atlantic Canada was cod. This industry was very decentralized, but also very co-operative. In western Canada the central staple was wheat. Wheat farming was a very independent venture, which led to a history of distrust of government and corporations in that part of the country. (Also important, however, were the shocks caused by volatility in the market for wheat and by the weather itself on the growing season.) In Central Canada, the main staple was fur, and the fur trade dominated the economy for many years. This fur trade was controlled by large firms, such as the Hudson's Bay Company and thus produced the much more centralized, business-oriented society that today characterizes Montreal and Toronto.

Innis depicted the relationship between regions of Canada as one of "heartland" to "hinterland":The periphery, or hinterland, is dominated by the core, or heartland. Because the heartland was dependent upon the search for and accumulation of staples (which were located in the hinterland) to perpetuate the economy, it sought to gain economic and political power by exploiting the hinterland.

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