Peter S. Spiro 

Peter S. Spiro is a writer and researcher on topics in law and economics, and a Fellow of the Mowat Centre for Policy Innovation at the University of Toronto's School of Public Policy and Governance. 



My interests are varied. Some people prefer to be specialists, but I find that regular involvement in different topics broadens my perspectives and improves my thinking on all the different projects I work on. Recently, I have been involved in subjects as varied as contract law, economic impact analysis, and personal income tax policy. My extensive background in the private and public sectors has provided me with experience in issues such as quantitative modeling of economic impacts, energy markets, factors driving capital investment, productivity growth, economic competitiveness, scenario analysis and cost of capital studies for benefit-cost analysis. I am one of Canada's leading experts on the social discount rate, and my analysis has been used for major infrastructure project evaluations, and in regulatory filings at the Ontario Energy Board.  

I completed my BA and MA in economics at the University of Toronto. Subsequently, I enrolled in the doctoral program at the University of Chicago, where I studied under Nobel Laureates Robert Lucas, Gary Becker, George Stigler, Milton Friedman and Ronald Coase, and obtained the highest grade in macroeconomics in my year. While I disagree with some of the ideology of the Chicago School, I subscribe to its tradition of challenging conventional wisdom and testing theories against the data. Supplementing my knowledge in economics, I have also studied law and received a JD (Juris Doctor) degree at Osgoode Hall Law School. Law and economics is a growing discipline that takes the view that legislation that affects economic activity should aim as much as possible to be economically efficient.

Research Expertise

Selected publications and reports:

"Informal Employment Contracts and the Battle over Retirement Benefits," Weak economic growth and the resultant financial pressures have made post-retirement benefits a tempting target for cutbacks, in both the private and public sectors. This has been an increasingly common source of employment law disputes. This paper won the 2014 Stringer LLP Essay Prize for the best paper in Labour Law.

"Problems of Interpreting Statutes of Limitations in Cases of Continuing Breach of Contract," Canadian Business Law Journal, December 2013. Most authorities hold that a cause of action for breach of contract crystallizes as soon as the breach has occurred. Logically, for statutes of limitations, the time will start to run from that point. This paper identifies some inconsistent applications of that principle in cases of continuing breach. It is argued that this approach is inefficient for most cases of breach of contract, and runs counter to the aim of certainty in business decision making.

"Challenges in Shifting Canadian Taxation toward Consumption," co-authored with Jonathan R. Kesselman, Canadian Tax Journal, 2014 No. 1. This paper confronts the conventional wisdom regarding the benefits versus costs of shifting the mix of revenue from income onto consumption. It suggests that the benefits have been oversold, while the consequences for income distribution have been disregarded. Middle class taxpayers would likely end up as net losers, as they do not receive the compensating credits that are given to people with low incomes.

"Sectoral Analysis of Ontario's Weak Productivity Growth," International Productivity Monitor, Fall 2013. Productivity is like the weather. It's bad, everybody talks about it, and usually nobody succeeds in doing anything about it. In this paper, presented at the annual conference of the Canadian Economics Association, I examine productivity in a detailed way, looking at performance in more than 50 individual sectors. What emerges is that the average productivity figure for Ontario (zero for the past 6 years) is rather misleading. It's the random outcome of a great deal of underlying diversity. Some sectors had strong productivity growth, while others have had not low or zero growth, but actual declines in productivity. My key finding is that productivity is closely related to demand growth and economies of scale. The main reason for Ontario's dismal productivity performance over the past several years is falling exports. That is mainly due to the weak US economy and an overvalued Canadian dollar. These problems will not disappear overnight, but the prospect is brighter going forward. 

"Clarifying the Rules for Piercing of the Corporate Veil" The principle of corporate limited liability emerged in the early 19th century in the United States. It was a major legal and economic innovation that facilitated the growth of large scale enterprise, without which the modern economy would not be possible. Courts quickly became aware that the corporate form could be abused for fraudulent purposes. Equity will not countenance fraud, and judicial discretion was applied to pierce the corporate veil. Unfortunately, its application is inconsistent and unpredictable. It is most frequently applied against small, closely held corporations, and creates uncertainty for these business owners. This paper suggests some amendments to the Business Corporations Act to create a statutory basis for curtailing limited liability where appropriate. This reform would lead to more consistency and predictability.

"Weak competitiveness hurts productivity – not the other way around," Globe and Mail Economy Lab, June 11, 2013. An overvalued dollar hurts the most efficient sectors of the economy, and this is largely responsible for the widely lamented low productivity growth of the last several years. By contrast (and contrary to popular myth), when the dollar was low in the 1990s, exporters did not use it as a crutch. Manufacturing productivity increased 50% over the course of that decade.

"Can a Dividend Tax Credit Be Justified in a Small Open Economy?" Many economists have pointed out that our tax system is riddled with tax credits, many of which fail to achieve their objectives. Eliminating them and using the revenue to lower the overall tax rate would likely be beneficial. This paper looks at Canada's dividend tax credit, and argues that in a world of highly mobile capital it is probably obsolete.

"Was your mortgage made in Bangladesh?" The linkages between Canada and developing Asia are far reaching. We depend on them not only for cheap goods, but ironically also to fund our borrowing. There is a serious global imbalance due to the rapid industrialization and unequal distribution of income in those countries. They are trying to sell more to the developed world than they are willing to buy. This global savings glut has been rightly identified by Ben Bernanke as the root cause of the developed countries' economic malaise.

"More Stability, Please." The central thesis of this paper is that a freely floating exchange rate is too much at the mercy of speculative fads. History has demonstrated over and over that unregulated financial markets do not produce optimal outcomes, and the events of the last several years are just a particularly unpleasant example. The exchange rate is the single most important price signal affecting the real economy. Its fluctuations have been particularly hard on Ontario, which is the part of Canada most dependent on non-commodity exports. The surge in the exchange rate to far above its fundamental value has undermined investment, productivity and employment in Ontario, and caused a severe setback in growth in the standard of living. A central bank can always keep a cap on the value of its own currency, as the Swiss National Bank has successfully shown in the last few years.

"The Mystery of Cash." This contribution to the Globe and Mail's Economy Lab looks at recent growth in cash in circulation in the Canadian economy. Based on increasing use of debit card and credit cards, one would expect the use of currency in Canada to be on a declining trend. In fact, it has remained quite robust, perhaps because of the popularity of cash transactions in the underground economy.

"Petrodollar really a loonie bubble," Financial Post,  2012.  In this article, I suggested that the Canadian dollar is overvalued, and the high correlation between the dollar and oil prices is not justified by fundamentals. (Original title: "The Canadian Dollar and Oil Prices: A Case of the Tail Wagging the Dog.")

"Evidence on inflation expectations from Canadian real return bonds," 2003. This article confronts the common view that the difference between the yields on nominal versus real return bonds precisely reflects the market's forecast of inflation. I find that this is not the case, and the two types of interest rate are influenced by different factors.

"The Differential between Canadian and U.S. Long-Term Bond Yields." Canadian Business Economics, 1994. In this article I confronted the view argued by the Bank of Canada, that their policy only affects short-term interest rates. The evidence shows that longer-term bond yields are in fact quite sensitive to expectations about short-term monetary policy. 

"Taxes, Deficits and the Underground Economy," in O. Lippert and M. Walker, eds., The Underground Economy: Global Evidence of its Size and Impact (Fraser Institute, Vancouver, 1997.) This article looks at some of the global evidence of the size of the underground economy, and some of the sociological factors surrounding the public acceptance of taxation. It argues that the political handling of the introduction of the GST increased the public's antipathy towards the tax, and worsened the evasion problem. By contrast, the introduction of a similar tax in Switzerland was approved in a referendum. 

"Estimating the Underground Economy: A Critical Evaluation of the Monetary Approach."  Canadian Tax Journal, 1994. This econometric study found that tax rates were a significant factor determining the demand for currency in circulation (cash money). Cash is used by participants in the underground economy because it is anonymous and enables them to hide their activity from tax collectors. This linkage enables us to infer growth in the size of the underground economy from changes in the stock of currency.

Some additional papers can be found at my SSRN page here.

Some case comments I have written can be found at, where I am a Senior Contributing Editor:

A Damage Award to Discourage Age Discrimination in IBM Canada Limited v Waterman The Supreme Court Sends a Clear Message in Katz Group v. Ontario that Judges Should Defer to Government Policy The Criminal Code and Industrial Accidents: R. v. Metron Construction The Ontario Court of Appeal Clarifies Rules for the Division of Property in Buttar v. Buttar The Supreme Court Gives Leave to Appeal against Mandatory Retirement for Law Firm Partners Risky Business: Ontario Court Imposes Vicarious Liability in Choc v. Hudbay Minerals Inc. for the Torts of a Foreign Subsidiary The Evolving Question of Res Judicata: Penner v. Niagara (Regional Police Services Board) Looking Abroad: The UK’s New Supreme Court Flexes its Muscles on Fundamental Justice Ontario Students Succeed in Suing their College for Negligent Misrepresentation The Supreme Court Redefines Resulting Trusts and the Legal Meaning of “Gift” in Nishi v. Rascal Trucking Ltd.

O’Neill v. General Motors of Canada is a very interesting case in which non-unon retirees won a class action lawsuit against their former employer. The court found that General Motors was in breach of contract for reducing their health and insurance benefits. Issues of this type will loom large in the coming years as the forces of global competition press employers to reduce their compensation costs.

Daishowa-Marubeni International Ltd. v. Canada, where the Supreme Court redefined taxable consideration. The case dealt with the sale of timber lands where the owner had a legal obligation for environmental reclamation costs. This is of considerable economic significance for other resource industries as well, leading the Canadian Association of Petroleum Producers to join in as an intervener.

Examples of Specific Project Experience

Econometric analysis of the determinants of productivity growth.

Econometric analysis of the factors affecting business capital investment decisions.

Evaluation of equity and economic efficiency impacts of altering the types of taxes used to collect government revenue.

Evaluating costs of factors of production for nuclear decommissioning in the distant future.

Developing long-term scenarios of economic growth and productivity.

Inflation adjustments in public utility regulation.

The relative cost of borrowing using real versus nominal return bonds.

Financial risk analysis with alternative scenarios and statistical probability ranges.

Discount rates for benefit/cost evaluations of major infrastructure projects.

Analysis of risk factors to be considered in benefit-cost evaluations of infrastructure projects.

Analysis of infrastructure adjustments needs in response to long-term climate change.

Assisted lawyers in preparing an appeal to the Supreme Court of Canada on a matter related to legal policy and taxation.