“It appears that aggregation may be pushed much further in inventory analysis than has heretofore been generally felt justified.” Originating with P. G. Darling and confirmed by M. C. Lovell, this oft-quoted assertion has in large measure been responsible for what might be termed a “consensus” (albeit implicit) on the usefulness of aggregation in empirical inventory studies. Professors Eisner and Strotz carry this interpretation to its extreme by declaring that they “prefer, at the theoretical level, to disaggregate by motive rather than stage [of fabrication].”

The purpose of this study is to take a closer look at the role of the inventory components (i.e., finished goods, goods in process, and raw materials) in aggregate inventory behaviour. Paramount among the issues addressed is the Eisner-Strotz assertion: is it meaningful to speak (on a theoretical or empirical level) of motives for holding inventories without reference to the stages of fabrication?

In the 1962 federal election in Canada, to the great surprise of almost all political observers, the Social Credit party obtained 26 per cent of the votes in Quebec—as against 39 and 30 per cent for the Liberals and the Progressive Conservatives respectively—and gained 26 of the 75 seats of the province. If one considers that in the preceding election the Social Credit Party had obtained no seats and less than one per cent of the vote, there were good reasons to be astonished.

The purpose of this paper is, first, to show in what ways the political situation at the federal level in Quebec was particularly conducive to the rise of the Social Credit party and, second, to present a general hypothesis concerning the political factors which account for the rise of third parties during other periods, and elsewhere in Canada.

To be sure, the rise of Social Credit, as well as of other third parties in Canada, was not the result of a single overriding factor. Many facets of reality—social, economic and political—were involved. In the case of Social Credit, in particular, economic “strains” were as important an independent factor as the political conditions to be discussed below. As can be seen from Table I, our survey data clearly show the strong effect of unemployment in the respondents' family, which accounts for some 30 per cent of the variation in the support of Social Credit.

In recent years some economists have suggested that under a wide range of circumstances free international trade will result in a situation where each country simultaneously produces, exports, and imports products which are very close substitutes for each other in consumption, production, or both. Because of the similarity of these products they are commonly accounted for in the same statistical “industry” classification, and the resultant international pattern of production and trade can conveniently be described as “intra-industry specialization” as contrasted with “inter-industry specialization” which results when countries produce and export but do not import the output of some industries while they import but do not produce or export the output of some other industries. It was considered that in the European Common Market intra-industry specialization dominated over inter-industry specialization and that similar developments were important in the development of Benelux trade. At the same time, but independently from these two suggestions in the literature, two pieces of research produced models capable of explaining which country would tend to specialize in which of the different qualities or styles of commodities making up the international trade in products of the same industries.

Although the interrelationship between socio-economic characteristics and electoral behaviour in Canadian elections is widely recognized, only recently have attempts been made to evaluate these interactions in a precise manner. The approaches used so far vary in methodology–using both interviews and voting results–and in the level of analysis–ranging from poll to constituency to province to nation. The results depend to some extent on the research approach. Particularly strong variations exist in the effects of social variables in different provinces and different constituencies.

This study presents another research alternative, using multiple regression techniques to combine census small-area information with voting results at the poll level. Although the strengths and weaknesses of this approach are discussed in detail by Meisel and Paquet, few Canadian studies have yet exploited its potential return. Problems of sampling and of variations in candidates and issues among constituencies are replaced by the difficulties of ecological correlation, but the use of regression procedures allows the evaluation of the predictive power of the explanatory variables.

The Stolper-Samuelson theorem asserts that an ad valorem import tariff (in a two-commodity, two-factor country) will bring about a more than proportionate rise in the price of the corresponding “intensive” factor in that industry. On the other hand, Rybczynski establishes the proposition that an increase in the labour force with constant aggregate endowment of the other productive factor (in a two-commodity, two-factor country) results in a greater than proportionate increase in the output of the labour-intensive commodity and an actual decline in the total output of the other commodity when the terms of trade are held constant. Jones has recently pointed out in this Journal the dual nature of the relationship between the Stolper-Samuelson theorem and the Rybczynski effect.

Policy makers have recently devoted a great deal of attention to the interest rate ceiling on bank loans, one of the two main impediments to the free flow of funds within the Canadian capital markets. The other major impediment, the interest rate ceiling on government-insured mortgages, has largely been ignored despite the pronounced impact it has upon the allocation of funds, and the recommendation of the Royal Commission on Banking and Finance that it be abolished. Recent instability in the residential construction sector has, however, once again focused attention upon this ceiling and raised the question of its desirability. The purpose of this paper is to correct a major misconception concerning the impact of this ceiling and to point out some of the other major implications of an interest rate maximum on governmentinsured mortgages.