An analysis of Canadian cross-border travel

Abstract

Cross-border shopping by Canadians in the United States is examined for the seven Canadian provinces bordering the United States. Data on same day automobile trips and expenditures obtained from Statistics Canada, International Travel Section are analyzed using multiple regression techniques. New Brunswick, British Columbia and Ontario demonstrated the most cross-border shopping activity as measured by per capita same day automobile trips and real per capita same day automobile trip expenditures. Across the provinces, cross-border trips and expenditures were driven by per capita income, the appreciation of the Canadian dollar, the ratio of Canadian to US gasoline prices, and the onset of the Goods and Services Tax (GST). There were regional differences in the determinants of cross-border shopping. The exchange rate was most sensitive on per capita trips in Ontario, Manitoba, and Saskatchewan; while per capita income was most sensitive in New Brunswick, Manitoba, and Saskatchewan. The gasoline price variable was most sensitive in British Columbia, while the GST had its strongest impact in Alberta.